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The number of new Ethereum addresses created has dropped to its lowest level this year, indicating a cooling demand for the digital asset. The activity on the ETH network has significantly declined, with a noticeable decrease in active addresses over the past few months.
The approval of the ETH spot ETF and the lack of expected price increases might be contributing to the waning interest in Ethereum. Despite the much-anticipated approval of the spot exchange-traded fund (ETF) in the United States, interest in Ethereum has significantly dropped in 2024. Recent data shows that the creation of new Ethereum wallet addresses has reached its lowest point this year, reflecting a clear decline in demand for the digital asset.
Currently, the seven-day moving average of new addresses stands at 82.15K, the lowest since December 2023. This decline has exacerbated the drop in active network addresses in July, indicating reduced activity on the ETH blockchain.
The number of active addresses has sharply decreased from 931.8K in June to 564.8K in August, nearing the lowest level in six months. While network activity has slowed, other competing blockchains like Solana and Bitcoin have seen success, with an increase in the number of new addresses created. Solana, often dubbed the “Ethereum killer,” has seen growth in its decentralized exchange (DEX) ecosystem, partly due to the popularity of memecoins.
Ethereum Fails to Meet Expectations
One possible explanation for the drop in new Ethereum addresses could be related to the recent launch of the spot ETF in the U.S. It appears that some investors are opting for these funds instead of directly purchasing the cryptocurrency, affecting the demand for ETH. Additionally, the Dencun upgrade in March 2024 reduced the total supply of ETH but did not achieve the expected price increase, which may dampen investor enthusiasm.
Ethereum is facing a broad market crisis. It is currently trading at around $2,240, having dropped 23% in the past 24 hours and over 28% in the past week. ETH’s market capitalization has also plummeted, now standing at $288 billion. Since reaching an all-time high of $4,891 in November 2021, Ethereum has fallen by 55%.
Sentiment: Positive
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