Of the 66.34 million Ethereum holders, many of them have been dormant for some time now. Therefore, despite the price increase, the volume was at a low level. But the reasons and effects of this situation extend beyond what it appears.
Ethereum calmed down…
Despite the broader market making a relatively quicker recovery, Ethereum’s performance has been lukewarm at best.
The altcoin king lost all future gains, making the altcoin rally considerably slower than other coins, including Bitcoin.
While the king coin has managed to rise by over 10.5% in six days, ETH is still at 8.67% even after nine days. This is because any price gains registered over the span of 2-3 days are negated within one day.
This price fluctuation is what keeps investors from moving their assets too much. The buying and selling is minimal for the same reason.
Consequently, the average transaction volume on a 7-day average has dropped to the lowest it has ever been in 22 months.
This behavior of HODLing is also verified by the fact that the rate at which Ethereum changes hands has also truncated to an 18-month low.
In fact, the Ethereum whales who cumulatively hold over 21.3% of all supplies have been sitting silently for a while now. Their average volume has come down to $700 million from $1.2 billion.
But this investor hibernation actually protects them from any serious loss. Price movement will eventually recover, but an exit at the wrong time would result in lost profits for investors.
This is also why for the last seven months the network has only been realizing profits.
Currently, 63.4 million addresses are either in / in the money (recording profits) and only 4.7 million investors are strapped for money (recording losses), including 3.85 million investors who bought around the all-time highest price of $ 4,811.
Thus, as the sentiment of accumulation is once again rising, going forward new investors would only experience profits as the downtrend is beginning to lose strength.
