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The Number Of Active Wallet Addresses On Ethereum Making ATH, What Does This Say?

The number of active wallet addresses on the Ethereum (ETH) network set an all-time high. However, this surge is not necessarily a good sign.

The Number Of Active Wallet Addresses On Ethereum Making ATH, What Does This Say? 4

As can be seen, during the period when the ETH price increased from $1,000 to $1,800, at one point the network recorded more than 934,000 active wallet addresses.

The number of active addresses on Ethereum. Source: CryptoQuant

This number is the highest ever. Some of the reasons for this phenomenon can be mentioned as follows:

The nearly 80% price increase has created a certain amount of FOMO among retail investors. The rally of the past weeks has been significant for a top altcoin. A price return to early May levels is something that many altcoins cannot achieve.
Investors are constantly hearing about the news and expectations of The Merge upgrade. And they saw the price go up, which gave more incentive to buy ETH.
Besides, there is an increase in NFTs and Altcoins Low Cap transactions, which belong to the Ethereum network. A glance at the number of transactions on OpenSea shows this increased activity.

Number and volume of NFTs traded on OpenSea. Source: Dune

Interestingly, while the number of NFTs traded is higher than in the previous two months and is similar to the September 2021 period, the volume is less than 20% of the highest months of 2021. That means NFT is still being translated but at a meager price.

JA_Maartun‘s observations provide a more comprehensive picture of Ethereum price history and active wallet address volume volatility.

In all the times that such a wave of FOMO occurs, it is followed by a “top” in the price of Ethereum. This time is different because the number of active addresses did not increase during an uptrend but increased to the highest in history during a downtrend.

Does that make us wonder, if the forecast declines from here, how far will the ETH price be? However, Maartunn suggests that this may just be a transient local peak. This means that the price of ETH will decrease in the short term and will continue to increase thanks to the positivity of the majority.

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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Harold

CoinCu News

Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.