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On-chain data shows metrics related to network activity have risen in Ethereum recently, something that could pave the way for a further rally.
Ethereum Transaction Volume & Whale Transfer Count just increased
According to data from on-chain analytics firm Santiment, Ethereum has seen increases in two performance-related metrics. The indicators in question are Transaction Volume and Whale Transaction Count.
The first of these, “Transaction Volume,” tracks the total amount of cryptocurrency (in USD) that users on the ETH network exchange across the network through their activities.
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If the value of this metric is high, it means that the ETH blockchain is currently processing the transfer of a large number of coins. Such a trend suggests that investors actively invest in the stock market.
On the other hand, a low index means that interest in the cryptocurrency is likely to be low right now as owners circle the low value of ETH.
Now, here is a chart showing the trend in Ethereum Transaction Volume over the past few months:
As shown in the graph above, Ethereum Transaction Volume has registered a sharp increase recently, which means that interest in the asset has increased alongside the price rally.
This can be considered a positive development for cryptocurrency, as increased network activity is often required for the circles to be sustainable.
In the past, the movement of certain prices has started significantly, but the Transaction Volume has not registered a significant increase at the same time. Such measures usually ended before long.
The chart also contains data for another correlation metric here, “Whale Production Count.” This index measures the total amount of ETH transfers with a value greater than $100,000.
Transactions of this scale are assumed to come from whale companies, so the Whale Transaction Count reflects the level of activity of high-net-worth investors.
From the graph, it is clear that this indicator has also increased in Ethereum recently, which means that the recent increase in volume is not only a sign of interest from small investors but also funny hands.
Naturally, it is impossible to say based on these indicators only, whether investors are buying or selling, since all types of transactions look the same from their point of view. Due to the fact that ETH has seen a sharp rally recently, this activity has probably been cumulative until now.
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The analytics company explains,
Expect any growth from Bitcoin, during this bull run, to see profits redistributed to Ethereum and possibly push it to its all-time high while its network activity looks very healthy.
Trading currency of ETH
After seeing an increase of more than 27% in the last seven days, Ethereum broke above the $3,150 level.
Featured image from Dall-E, Santiment.net, chart from TradingView.com
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