Over the past week, more than 7,000 Ethereum (ETH), worth over $20 million, has been added to circulation. This has brought the altcoin’s circulating supply to a six-month peak of 120.39 million ETH.
This increase could put downward pressure on the cryptocurrency’s price if demand fails to keep up with the influx of new coins. With that in mind, this analysis highlights key price levels that holders should monitor as this occurs.
Ethereum faces fall of use
Circulating supply refers to the number of cryptocurrencies available to the public. The metric does not include coins that are locked, reserved, or otherwise unavailable for trading.
According to data from Ultrasound Money, 7,728 ETH were added to circulation in the last seven days. This increase usually occurs when user activity on the network decreases.
Ethereum Circulating Supply. Source: Ultrasound Money
On-chain data from Artemis confirms this decline. Over the past week, the daily count of unique interactions on the Ethereum network has fallen by 3%.
Due to this drop in transaction count, network fees also plummeted. According to the data provider, fees fell by 43% during the analyzed period.
Ethereum Network Activity. Source: Artemis
When the daily transaction count drops, it indicates a decrease in network activity and usage. This reduced demand on the network can negatively impact the price of the cryptocurrency, and this has been the case for Ethereum in recent days.
Read more: Ethereum ETFs – Understand what they are and how they work
Price prediction
Ethereum is currently trading at $2,619, holding just above key support at $2,579. However, if market activity slows down further and demand for the altcoin weakens, bulls may struggle to hold this support.
In that case, the price could decline towards the next support level at $2,264.
Ethereum Price Analysis. Source: TradingView
On the other hand, an increase in network activity could boost demand for the altcoin, positively impacting its price. If this occurs, Ethereum could recover and rise towards $3,336.
The article Ethereum (ETH) Forecast: How Can the Price Behave Today? was first seen on BeInCrypto Brazil.
