Experts Still Don’t Explain The Spike In Active ETH Addresses

Online measurement company Santiment is still investigating the cause of the sudden increase in active ETH addresses, which eclipsed the previous ATH by a whopping 48%.

On July 27, the analytics firm tweeted that the number of daily active addresses on Ethereum had suddenly spiked to 1.06 million, breaking the previous high of 718,000 set in 2018.

An active address is an address that has made a transaction in the last 24 hours. The number of active addresses can indicate the level of on-chain activity from developers and projects entering updates to their work or platform and traders performing simple token transfers.

However, Santiment said its team is still investigating the cause of the spike.

Head of the strategy at Coinbase Conor Grogan posted in a Twitter thread that the increase in activity came from a large number of token transfers per unit of gas, not from more adoption.

He explained that the spike in active addresses was due to increased explicit send/receive activity such as “Binance is conducting a maintenance scan,” as opposed to “efficient” activity from decentralized finance (DeFi) and non-fungible tokens (NFT).

Active addresses have been up since a two-year low of 364,400 on June 26, with a notably smaller spike on July 16 to 583,000, according to Santiment data.

The Tether Daily Active Addresses Index (USDT) has also seen a significant spike in active addresses over the past two days, from July 26 to 27, corroborating the observation of Grogan on the more significant activity from a simple token transfer.

The Goerli and Prater testnets for Ethereum are expected to merge together into a single Goerli testnet between August 6 and August 12, according to a blog post on July 27 from the Ethereum team. The Ethereum mainnet is expected to conduct a consolidation on September 19.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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