Ethereum (ETH), the second-largest cryptocurrency by market capitalization, has been grappling with market instability and a declining on-chain activity, sparking concerns among the crypto community. As of Wednesday, the current ETH price hovers around $1,629, showing modest 24-hour gains of 0.5% but a seven-day dip of 4.9%.
Over the past few weeks, Ethereum has seen multiple rebounds from the support trendline at $1,626, thwarting sellers' attempts to instigate a significant correction. However, Ethereum's trajectory is still uncertain due to a persistent descending trendline dominating its corrective phase.
Recent price analysis suggests that if buyers maintain their pressure and the support trendline remains resilient, Ethereum could witness a 5-6% surge. This potential surge could challenge the descending trendline, and breaking past this resistance is crucial for a more pronounced recovery.
Despite these glimmers of hope, Ethereum's on-chain activity raises concerns. Transaction volume on the Ethereum blockchain has hit a nine-month low, accompanied by daily transaction fees reaching an eight-month low. This trend has led to growing consensus within the crypto community that users are losing interest in the Ethereum blockchain and possibly exploring alternatives.
In mid-April, there was a significant shift in investor sentiment towards Ethereum when it was trading at approximately $2,140. However, over the following four months, there was a consistent trend of large-scale selling by Ethereum "whales," individuals holding between 10 and 10,000 ETH in their wallets. These whales are often regarded as informed and influential players in the cryptocurrency market.
Adding to the uncertainty surrounding Ethereum's future trajectory are the actions of co-founder Vitalik Buterin. Over the past month, Buterin has been transferring substantial amounts of Ethereum from his public wallets to other cryptocurrency wallets. The movement of an approximate sum of $6 million worth of Ethereum is viewed by some as a potential red flag, comparable to corporate insiders selling their shares when anticipating a price decline.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.