Ethereum’s on-chain activity is down massively, but it could be calm before storm
Ethereum network activity has hit its lowest level in the last 5 years as the number of contracts deployed on-chain declined from around 2.7 million in July 2021 to less than 300,000.
Such a rapid drop in the number of contracts released on the chain is tied to two factors: the overall crisis in the industry caused by the lack of inflows and the upcoming fundamental update that might have caused a calm before the storm.
The spike in the number of contracts deployed back in the summer of 2021 was the catalyst for the rally that pushed Ethereum to the range of around $5,000, which remains the ultimate target for the second-largest cryptocurrency on the market.
One of the main reasons behind such a strong drop in the number of deployed solutions on the network is a period of extremely high fees that disincentivized developers and caused a stalemate with no new solutions appearing on the network.
Can merge fix this?
Most likely, we’re going to see a spike in the number of new applications and network activity on Ethereum post-merge as a new growth tool and a better network environment should attract more companies looking for new versions of the second largest. Looking for investment in Network in the digital asset industry.
According to the reaction of the cryptocurrency market, a lot of investors believe in an upcoming spike in the number of users on Ethereum after the update gets successfully implemented.
At press time, Ethereum is trading above the $2,000 price range and it is targeting the next major resistance at $2,100.
