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Summer 2024 has brought a significant slowdown for Ethereum, the world’s second-largest cryptocurrency. Recent data reveals a massive decline in trading volume and transaction activity throughout August, raising concerns among investors.
📉 Activity Slump on the Ethereum Network
Ethereum is currently experiencing worrying signs of disinterest, especially from institutional investors. The latest data paints a grim picture:
- Trading Volume Collapse: The 7-day moving average of daily volume has dropped by 55% from July, plummeting from $6.56 billion to $2.9 billion.
- Transaction Numbers Dip: Last Sunday, the Ethereum network recorded only 1.07 million transactions, marking the lowest level in months. August’s total stands at 27.27 million transactions, a number not seen since May 2020.
🔍 What’s Causing This Slowdown?
A few key factors are driving this downturn:
- Seasonal Slowdown: Analysts from Coinbase attribute part of this drop to the summer season, which traditionally sees reduced activity in financial markets. However, this year's decline is less sharp than in previous years.
- Decreased Institutional Interest: Ethereum’s underperformance in spot ETFs, especially compared to Bitcoin, suggests a fading interest from institutional investors. BRN analyst Valentin Fournier even recommends focusing on Bitcoin, predicting Ethereum will continue to lag in the weeks ahead.
🌥 A Glimmer of Hope?
Despite the current challenges, some experts maintain a long-term optimism. A bold prediction even suggests Ethereum could surpass Bitcoin in market capitalization by 2029.
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