Ethereum Takes a Leap, Now Accounting for 18% of the Total Crypto Market Cap

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Created by TradeOr

3rd Party Analysis 01 Jul 2021

Key Takeaways

  • Ethereum trades 10% up in the last 7 days.
  • ETH made history and overtook BTC in the number of daily active addresses.
  • Ethereum network activity jumps substantially.

Ethereum is taking a breather, after its recent 40% rally. However, key metrics predict ETH won’t stop here and may soon resume its path to higher ground. At the time of writing ETH/USD is trading just above the $2k level (down 3.8% in 24hrs). However, if we look at the bigger picture as far as the crypto’s price action is concerned and the world’s second largest cryptocurrency trades 10% up in the last 7 days. Moreover, over the last 5 days, ETH is the best performing crypto asset among the top 5.

This week we are pulling back the curtains on how ETH made history and overtook BTC in a key milestone. Also, we dive into the declining costs of transacting on the Ethereum Network.

ETH Surpasses BTC

Ethereum may not have claimed the top spot on the crypto podium in terms of market cap, but the digital asset claimed the top spot in another area. The recent price rally for the cryptocurrency pushes it above BTC in active address metric, according to analysts at crypto analytics firm Santiment. The firm explained, “on a day that saw history be made with Ethereum surpassing bitcoin in daily active addresses for the first time, altcoins came to play”.

Furthermore, the analytics firm pointed to the fact that Ethereum Gas Fees were at a 6-month low. The average transaction fee has fallen to as low as $2.15, the lowest since December 2020.

According to Simon Peters, a market analyst, “during May’s epic bull run, the average cost was $70.00. However, have all dropped following the market correction. As the network moves towards the 2.0 upgrade, it is possible fees will fall further, despite taking years before it is fully implemented. However, the upgrade will eventually see faster and cheaper mining, alongside improving Ethereum’s green credentials.”

Another first for ETH came on Thursday, as Ethereum 2.0 crossed 6 million staked coins under its deposit contract. This is a rise of 1 million since May. This rise means that the “total value of the staked ETH under the deposit contract of ETH 2.0 touched $12.7 billion” according to Etherscan, a blockchain explorer and analytics platform for Ethereum. Overall, we have seen a significant leap in the network activity of Ethereum this week.

Ethereum’s Network Activity

Eth whale transfers and active ETH addresses are on the rise. Moreover, volatility since overtaking BTC’s daily address activity has increased. A tweet from Santiment on Wednesday stated “whale tracking data indicates that $ETH whale address holding 10k+ coins now hold 70% or more of the supply for the first time since September 2017.”

In the last week, Ethereum-related investment products witnessed $50 million worth of outflows, the highest level on record. Nonetheless, the overall institutional influx in such products remains positive.

In light of the recent activity, ETH has drawn the attraction from CNBC’s Mad Money host Jim Cramer, who has stated his preference for Ethereum over other cryptos. Further adding his desire to expand his ETH portfolio after selling his entire Bitcoin holdings.

The Ethereum Outlook

The first quarter of the year saw new record highs across the crypto space. BTC lead the way but shortly after ETH hit its own all-time-high, leaping above the $4k level before its massive crash to below $1,800.

However, it has since rallied back above $2k and is now back to April levels. Year to date, the crypto is more than 800% up. Although it’s hard to know the future important metrics are point in favor and higher gains for Ethereum.

Should I have Crypto in My Portfolio?

Yes, it’s true that cryptocurrency is a volatile space, however, having crypto within your investment portfolio provides plenty of opportunities. Digital assets have not yet proven to have a direct correlation with more traditional investments such as stocks. It is, for this reason, it is a valid asset class to have. Crypto’s unique characteristics and volatility also present an opportunity. The lack of correlation reduces your overall portfolio volatility and provides the potential for significant gains.

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