Ethereum follows market sentiment and reaches an important price
Ethereum’s return above $ 3,000 was a sign of relief for the majority of the market as the crackdown on Chinese cryptocurrency transactions led to a retracement of the entire market of around 20%. There are multiple causes behind Ethereum’s price action, and the main one is the appearance of interest coming from short-term traders, according to IntoTheBlock.
On the chart provided by crypto analysis services, the number of traders who have owned ETH for less than a month now hold 43% more funds since July and could even approach the ATH than “young wallets. “reached in May.
The number of young wallets has reached 3.8 million addresses with close to 20 million ETH. The average shelf life of coins in these wallets is 10 days, which means the majority bought their Ethereum coins during the September 20 drop when the price of ETH fell 12% and fell below. The buying power correlates with a strong support zone.
In addition to the data provided, Ethereum’s supply has been deflationary for several days. With a constant reduction in supply, traders and long-term investors are looking forward to buying an asset with limited supply that might rise in price in the future.
As more buying power of Ethereum appears in the market, we can still observe a downward trend in supply on the exchanges, indicating that traders or investors are unwilling to hold onto their funds. Without constant selling pressure on the market, ETH was able to recover after a flash crash.
Previously, Ethereum’s main developer Vitalik Buterin posted an article describing the upcoming EIP-4337 network update, which will bring the new transaction logic to the network and create additional functionality and possibilities for developers.
