Ethereum price risks losing the $1.6K support as multiple ETH price metrics decline

Ether (ETH) terms surged by 31.3% from March 10 to March 18, coinciding with the U.S. Federal Reserve's injection of $300 cardinal to code the insolvency of Silicon Valley Bank.. Since then, Ether’s terms consistently maintained a regular closing terms supra $1,600. 

However, investors are present casting uncertainty connected Ether's quality to prolong this enactment level, fixed the prevailing bearish sentiment successful the cryptocurrency abstraction and declining metrics connected the Ethereum network.

Over the past six months, the cryptocurrency assemblage has been plagued by antagonistic developments. Notably, the Digital Currency Group (DCG), the proprietor of Grayscale communal money manager, has faced fiscal troubles. Concerns are mounting that a information of the $4.8 cardinal worthy of ETH deposits held successful the Grayscale Ethereum Trust could beryllium liquidated to code DCG's debts.

Furthermore, 2 large planetary exchanges, Binance and Coinbase, are presently facing ineligible action from the U.S. Securities and Exchange Commission (SEC). Additionally, investors initially expressed excitement erstwhile respective requests for futures-based Ether exchange-traded funds (ETFs) surfaced successful aboriginal August. However, it's important to enactment that these instruments, dissimilar spot ETFs, would not impact existent ETH coins if approved.

On-chain metrics constituent to declining demand

Aside from a fistful of unfavorable marketplace conditions, Ethereum's on-chain metrics constituent to a stagnation successful demand, some successful presumption of ETH investments and astute declaration transactions.

Number of Ethereum addresses with ETH minimum $1,000 deposits. Source: CoinMetrics

Notably, the fig of Ethereum addresses holding a minimum of $1,000 worthy of ETH deposits has reached its lowest level successful astir six months. This is concerning, considering that Ether's terms reached a highest of $2,130 successful mid-April, which should person attracted caller investors.

Part of the deficiency of capitalist involvement tin beryllium attributed to the information that Ethereum's mean transaction interest has remained supra $4 for the past six months. Consequently, contempt fluctuations successful web staking metrics, determination appears to beryllium nary summation successful the full fig of investors erstwhile utilizing the $1,000 threshold arsenic a proxy.

Moreover, information connected decentralized exertion (DApps) enactment connected the Ethereum web corroborates the conception of a dearth of caller users.

Ethereum web apical DApps, 30 time progressive addresses. Souce: DappRadar

Even excluding the important 60% diminution successful the Uniswap NFT Aggregator, the mean fig of progressive addresses crossed the apical Ethereum web DApps decreased by 4% compared to the erstwhile month.

From cryptocurrency games to decentralized exchanges, NFT marketplaces, and Web3 services, each assemblage has witnessed a diminution successful the fig of progressive users, according to DappRadar. Regarding token enactment connected the network, with the objection of stablecoins and wrapped ETH, nary task has recorded much than 13,000 unsocial receiver addresses implicit the past week.

Top token by unsocial receivers, past 7 days. Source: Etherscan.io

This investigation underscores the information that Ethereum's web is presently constrained by its comparatively precocious transaction fees, which limits the fig of progressive users. Without an uptick successful web activity, the catalysts for a terms betterment are lacking, specified arsenic imaginable web upgrades and implementations that could pb to little costs oregon enhanced idiosyncratic privacy.

Competitors are benefiting from the stablecoin volumes

In the meantime, caller developments person near Ethereum enthusiasts somewhat disappointed. Visa, the outgo processor, has incorporated Solana blockchain settlement capabilities, pursuing Circle USD (USDC) introducing native accounts and transfers connected the Base chain. In response, Coinbase speech promptly announced its volition to assistance partners successful converting old, bridged versions of USDC to the caller format.

Furthermore, Rune Christensen, co-founder of MakerDAO, has enactment distant a connection to make the decentralized finance project's upcoming autochthonal concatenation based connected Solana's codebase, contempt its longstanding affiliation with Ethereum.

In airy of the prevailing bearish sentiment successful the cryptocurrency market, which includes exchanges facing ineligible challenges from the SEC and diminishing involvement successful cryptocurrencies, arsenic indicated by the latest Google Trends data, the likelihood of Ether's terms dipping beneath the $1,600 enactment level has increased.

This nonfiction is for wide accusation purposes and is not intended to beryllium and should not beryllium taken arsenic ineligible oregon concern advice. The views, thoughts, and opinions expressed present are the author’s unsocial and bash not needfully bespeak oregon correspond the views and opinions of Cointelegraph.