Following the transition to a Proof-of-Stake network, Ethereum has witnessed a significant contraction in its circulating supply, reaching the lowest point in over a year and a half. The recent removal of approximately 86,219 ETH from the market, equating to $300 million, suggests a growing demand for the cryptocurrency. Concurrently, the establishment of new daily addresses on the Ethereum network has surged, hitting a yearly high.
Surge in Network Demand
The Ethereum network’s conversion to Proof-of-Stake seems to correlate with heightened activity levels, evidenced by the sharp increase in daily new addresses. With over 116,000 new addresses recorded in a single day, the platform’s user engagement is on the rise. This bustling activity has brought down the total ETH in circulation to a mere 120.07 million, reflecting the most substantial supply squeeze since “The Merge.”
Financial Indicators on the Rise
Ethereum’s decentralized finance ecosystem has also shown robust growth, with a reported rise in the total value locked up in these financial applications. The ecosystem’s TVL now stands at $51 billion, marking a 21% increase from the previous month. Lido Finance, a leading protocol in the chain, has likewise seen its TVL swell by 27% during the same timeframe.
In line with these developments, Ethereum’s decentralized exchanges have experienced a remarkable surge in trading volumes, leaping by 161% over the last month. This increase is part of a broader altcoin market rally that has seen heightened transactional activity across the board. The NFT sector within the Ethereum network is not left behind, registering a 17% rise in sales volume to $617 million, even as the number of actual sales transactions has fallen by 57%.
The uptrend in Ethereum’s metrics, including a spike in exchange reserves to 14.1 million ETH, points to a robust market sentiment leaning towards ‘greed’, according to the crypto fear and greed index. These indicators underscore a period of intensified trading and valuation for the second-largest cryptocurrency by market capitalization.