In line with the current state of the market, the price increase of the Ethereum (ETH) blockchain network is being restrained. The price of the second-largest cryptocurrency by market capitalization fell by 3.01% to $1,846.85 during the previous day. The tiny rise of 0.62% over the previous week, however, has stitched up the present bearish downturn.
Crypto market analyst @Ali_Charts used Glassnode’s statistics to highlight the current health of the Ethereum network and demonstrate how the protocol has grown in terms of active users, transaction volume, and blockspace demand. He pointed out that each of these points to a robust adoption of the Ethereum network.
Although this is a clearly bullish tick for the Ethereum protocol, the current price action does not reflect the full significance of these outstanding network fundamentals. The expert offered an explanation for why this would be the case, noting that ETH is also seeing a decline in the network’s overall average number of active users.
This signals poorer network fundamentals and lower use, in his opinion. Reduced demand for Ethereum as a whole results from decreased utilisation, which is exhibited by a slower rate of price increase.
Ethereum and hope for dominance
One indicator of the blockchain protocol’s supremacy is the price of Ethereum. To be fair, the blockchain network and its ecosystem continue to be the most significant in the sector today.
The development and ongoing growth of Layer 2 protocols demonstrates the growing dedication to enhancing the blockchain’s inherent value. While Polygon zkEVM, Optimism, and Arbitrum, among others, are not directly beneficiaries of technological advancement, they are undoubtedly indirect beneficiaries.
The expansion and outstanding performance of these L2s increase the appeal of the underlying blockchain protocol, which benefits the broader blockchain and Web 3.0 ecosystem greatly.
