Ethereum (ETH) Bounces Back Above $4,300, Here Are the Key On-chain Metrics to Watch

By Bhushan Akolkar
Published November 20, 2021 Updated November 20, 2021
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Ethereum (ETH) Bounces Back Above $4,300, Here Are the Key On-chain Metrics to Watch

By Bhushan Akolkar
Published November 20, 2021 Updated November 20, 2021

As the broader cryptocurrency market poses some healthy recovery, the world’s second-largest cryptocurrency Ethereum (ETH) has bounced more than 6% moving past $4,300 levels. On Friday, November 19, the ETH price took a momentary dive under $4,000 correcting more than 15% from its all-time high levels from last week.

Certain on-chain metrics for Ethereum and its fundamentals suggest that the world’s largest cryptocurrency will continue to have the show of strength.

Key On-chain Metrics for Ethereum

As we reported earlier, the non-exchange Ethereum whales have been scooping up massive supply in this price correction. On the other hand, the average gas fee has corrected by a massive 80% just over the last week which is likely to give Ethereum a massive utility push. As on-chain data provider Santiment explains:

Ethereum (ETH) is back above $4,330, & utility should be more reasonable for traders with average fees back at just $11.46. This is about 20% of what $ETH fees were just five days ago right before the dip, where fees were way up at $55.65 per transaction.

Courtesy: Santiment

On the other hand, the Ethereum (ETH) supply has been on a decline. Post the London hardfork in early August 2021, the ETH supply dynamics have been changing majorly. The Ethereum (ETH) blockchain network is close to reaching a total of 1 million in burned ETH.

So far since the London hardfork, a total of 947,000 ETH have been burned. This is worth a staggering $4 billion. On-chain data provider Glassnode further reports:

The daily burn rate has been steadily increasing in the past months since the London fork. With a burn rate of currently 10-15k #ETH per day, the 1 million burn mark is expected to be passed within the next few days.

The amount of burned $ETH has started to visibly change Ether’s supply trajectory. The circulating ETH supply in the network is now 0.8% lower than it would be without the implementation of EIP-1559.

While Ethereum (ETH) has given a bounce back today, it remains to be seen if this is not a dead cat bounce moment. Simon Dedic from Moonrock Capital says that if ETH sustains $4,000 on the weekly closing, the dip could be bullish for investors.

 

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Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Bhushan Akolkar
820 Articles
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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