Key Takeaways:
- Reports show a successful quarter for the Ethereum Network.
- A combination of Liquid staking, regulatory clarity, and fiat interest propelled Ethereum’s dominance.
- The mentioned factors, plus ETH’s overwhelming self-custody, could push the token over $2K in Q3.
YEREVAN (CoinChapter.com) – Ethereum Network benefitted from its relative regulatory “immunity,” the pressures on the altcoin market, and the Shanghai upgrade in Q2.
According to a quarterly report from on-chain data tracker Messari, the alpha altcoin outperformed its competitors, adding 3% to its market cap quarter-over-quarter, compared to an average decline of 23% for other featured L1s.
Ethereum is ahead of the DeFi game
The meme coin craze for tokens like PEPE also contributed to the Network’s quarterly results, as well as BlackRock’s filing for a spot Bitcoin ETF. The latter event raised much speculation, but Ethereum investors were hopeful, given that ETH is the next most likely candidate for a spot ETF.
According to the Messari report, enabling withdrawals reduced the staking risks on Ethereum and, combined with liquid staking, gave the Network a boost.
Liquid staking protocols and the downstream use of their liquid staking tokens (LSTs) in DeFi have gained significant attention in 2023, particularly within the Ethereum ecosystem. By the end of the quarter, over half of ETH stake was in liquid form, including Coinbase’s cbETH, a 25% year-to-date (YTD) increase.
clarified the report.
ETH could reclaim the $2K level soon enough
Meanwhile, the #2 ranked digital asset has been flying relatively under the radar since dropping from its $2,100 heights in mid-April. ETH changed hands at just under $1,890 on July 21. But the Network’s quarterly success and relatively hype-free price action could help the token reclaim the psychological support level of $2,000.
Other on-chain factors supporting the bullish stance:
According to another on-chain data provider Santiment, ETH price action was outright “boring” for investors, compared to more “shiny” altcoins like XRP, which pushed 70% since its win in court against the SEC on July 13.
“The percentage of discussions about the asset is right about at its same 2023-low level that it saw back in mid-May,” read the report, adding that the circumstance is NOT a cause for concern. Moreover, Santiment stated that many altcoins thrive while “under the radar.”
One key sign of a potential upcoming price bottom would be when traders begin making a higher level of transactions while at a loss compared to when at a profit. Right now, we can see that the ratio of on-chain transaction volume in profit to loss is still favoring profit takes. But not by a large margin by any means…
stated the report.
Additionally, Santiment researchers stated that the overwhelming majority of ETH tokens lay in self-custody. With only 7% of coins on exchanges, the likelihood of huge sell-offs remains lower than usual.
This should be considered one of the best long-term bodes of confidence for the asset that had a somewhat disappointing halving (as far as price is concerned) in September 2022. […] We see no reason why ETH can’t make a move to get back above $2,000 sometime in August.
concluded the report.
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