After a bearish start, Ethereum (ETH) traded within a tight range throughout October, facing resistance at $2,736 and finding support at $2,326.
As the new trading month begins, analysts anticipate a possible rally — conditioned on a key premise: ETH must break its resistance level to confirm the bullish momentum.
Why Ethereum May Be Being Contained
In an exclusive interview with BeInCrypto, Victor Tan, founder and CEO of TrinityPad — a launchpad that empowers investors to support early-stage companies — shared that Ethereum could test the $3,500 to $4,000 range by November. Tan attributed this anticipated growth to recent advancements in layer 2 solutions and the increasing integration of decentralized finance (DeFi) on the platform.
“ETH could move toward $3,500-$4,000 by the end of the year if DeFi adoption continues to expand. Layer 2 technologies have already reduced transaction fees by about 20%, increasing Ethereum’s appeal,” he said.
However, the recent underwhelming performance of Ethereum’s DeFi sector over the past month has inspired little confidence. Data from DeFiLlama shows that the Layer-1 (L1) network has seen just a modest 2% increase in total value locked (TVL) over the past 30 days. In comparison, competing networks have gained significant momentum, with “Ethereum killer” Solana achieving a 12% increase in TVL and Aptos soaring by an impressive 47% over the same period.
Read more: Ethereum (ETH) Price Prediction 2024/2025/2030
Ethereum DeFi TVL Source: DefilLlama
Furthermore, Ethereum’s weak TVL growth reflects the low demand for the network over the past month. Data from Artemis shows that daily active addresses on the chain totaled 324,745 over the past 30 days, down 25%.
Due to the drop in the number of users on the chain, the number of daily Ethereum transactions also plummeted. Therefore, during the period under analysis, the drop was 13%.
Ethereum Network Activity. Source: Artemis
Increase in Ethereum coins in circulation
The reduction in activity on the Ethereum network has decreased the altcoin’s burn rate, increasing its circulating supply and putting downward pressure on its price.
Data from Ultrasoundmoney shows that over the past 30 days, an additional 38,598 ETH — valued at over $98 million at current market prices — has been added to Ethereum’s circulating supply.
Read more: Who is Vitalik Buterin? Learn about the Ethereum co-founder’s story
Ethereum supply. Source: Ultrasoundmoney
Furthermore, as more ETH tokens enter circulation, the available supply increases, which could lead to a drop in prices as supply outstrips demand. Therefore, this influx of tokens could contribute to short-term price volatility in November, especially if network activity remains muted.
The article Ethereum could hit $4,000 in November, according to analyst appeared first on BeInCrypto Brazil.
