Ethereum Price Volatility and Performance: Although Ethereum has gained 7.5% since its fall to $2,396 on August 27, it is still down 22% in the past 30 days, showing investors' uneasiness about its performance. Despite the increase in Ethereum network activity, the price has failed to recover to the $3,800 level in early June.
Ethereum ETF Demand Slump: The lackluster demand for Ethereum ETF spot, coupled with the over-anticipation of the launch of the ETF in the United States on July 24, has led to ETH's poor performance. Since April 24, the price of Ethereum has fallen sharply from $3,200.
Ethereum Network Activity and Competitive Pressure: Ethereum's decentralized applications (DApps) have improved in terms of TVL and transaction volume, especially the growth of its Layer 2 solutions. However, competing chains such as Tron and BNB Chain offer lower fees and simpler user experience, which puts pressure on Ethereum.
Network Activity and Active User Data: Although Ethereum's DApp transaction volume has increased, the number of active addresses has not increased, and the total number of transactions has fallen by 8%. In contrast, the number of active users of BNB Chain and Solana increased during the same period.
Weak inflows of funds into spot Ethereum ETFs: In the past two weeks, the net outflow of spot Ethereum ETFs was $107 million, indicating a lack of interest from institutional investors, which is in stark contrast to the strong inflows of funds into Bitcoin ETFs during the same period.
In general, although the Ethereum network has made some progress in technology and application, there are not enough positive factors to drive a significant increase in the price of Ethereum. At the same time, the low-cost advantage of competing chains poses a challenge to it, and the price of Ethereum does not seem to have a direct correlation with on-chain activities.
