Despite a price drop, 89% of ETH holders are in the green
A startling figure sticks out in the context of Ethereum (ETH), which dropped from $4,000 to $3,200 in less than six days, losing more than 11% of its value. Approximately 89% of ETH holders are still profitable. This insight, which emphasises investors' fortitude in the face of market volatility, is taken from a tweet from the cryptocurrency market intelligence platform IntoTheBlock.
After the Dencun update was put into effect on March 13, the price of Ether started to decline. Although the goal of this upgrade was to increase network scale and significantly lower transaction fees for layer 2 solutions based on Ethereum, it first received favourable feedback.
In the first 24 hours after the update, CryptoPotato had predicted that Ethereum network activity and supply dynamics would remain positive: more ETH would have been staked, the number of daily transactions would have increased, and the total supply of ETH would have even continued to decline.
But only a day later, analysts began warning of a price fall. Ether dropped below $3,500 after leaving the $4,000 region. A plausible theory is that the Dencun update's potential was impacting the price of Ethereum even prior to its release.
IntoTheBlock discovered that the highest possible selling volume is at $3,500, when over 991,000 addresses have acquired 4.35 million ETH, with 89% of ETH holders still profiting despite the price decline.
In the upcoming weeks, Ether might surpass $4,000 and hit new highs if it bounces back from its current $3,500 price level. A sharper decline, though, might push the asset below $3,000.
Analysts predict that the price of ETH may find support at $3,500, which might lead to a new upswing. However, if its price keeps falling, its support level might drop between $2,966 and $3,181.
The potential approval of Ethereum exchange-traded funds (ETFs) by the US Securities and Exchange Commission (SEC) is a major element that is expected to drive Ether in the upcoming weeks.
The organisation postponed making decisions on multiple requests until May 23. Asset manager VanEck said that because Ethereum and Bitcoin have similar markets, Ethereum ETFs would perform better and draw more interest.
According to recent predictions made by Standard Chartered bank, ETH could rise to $8,000 by the end of 2024 and $14,000 by 2025, indicating substantial growth potential for the cryptocurrency that is currently ranked second in terms of market value. Despite short-term price swings, Ether's bullish view reflects confidence in its capacity to innovate and react to obstacles.