Ethereum narratives continue to strengthen as on-chain metrics indicate increased usage and activity. This is all positively affecting demand for the asset and ETH prices.
Ethereum on-chain activity continues to increase as crypto markets recover. Several metrics, such as ERC-20 daily token transfers, have been steadily increasing recently.
According to Etherscan, the daily token transfer number topped 1 million again last week. Furthermore, it has doubled over the past six months or so.
It was also noted that network usage in terms of addresses has also surged. PrimeXBT reported a new record high of 92.5 million addresses over the weekend.
Ethereum Network Activity Up
The Ethereum unique address count is also at an all-time high of 221 million. The metric has increased by around 10% over the past six months.
Additionally, daily transactions on the Ethereum network have remained steady at around 1 million. This indicates that network usage and activity have not declined along with prices over the past three months.
The number of daily verified smart contracts on the network has increased by around 140% since the same time last year. There are currently around 600 new contracts verified on Ethereum every day, according to Etherscan.
The increased network activity and bullishness surrounding Ethereum fundamentals have boosted sentiment. On Jan. 29, crypto YouTuber Lark Davis said that Ethereum has been fundamentally solid throughout the bear market, adding, “in summary, no one has enough ETH.”
According to Ultrasound.Money, Ethereum issuance is currently deflationary at -0.04% per year. This means that the supply of circulating ETH is currently shrinking. Since the beginning of this year, the total supply of 120.5 million has decreased by around 9,200 ETH, valued at approximately $15 million.
Price Outlook
ETH prices are up 2.6% on the day at the time of press. As a result, the asset was trading for $1,638 during the early hours of Jan. 30.
Furthermore, ETH hit a 12-week high of $1,658 a few hours ago. It has made 36.7% over the past month, rising from below $1,200 at the beginning of the year.
Ethereum is currently facing resistance at these levels, where it was last trading in late October 2022. A breakout move could see ETH climb to the next level at around $1,800. However, if the crypto rally runs out of steam, ETH prices could fall back to support levels around $1,350.
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