As we close in on the Merge, Ethereum is facing a crucial junction on its course. The Merge preparations are doing very well on the network as the ETH 2.0 deposit contracts continue to register new all-time highs (ATHs).
Meanwhile, stablecoin activity on Ethereum has been increasing according to a recent tweet by analytic firm Santiment.
USDT on Optimism is almost nothing compared to USDT on Ethereum. DAI on Optimism is also increasing and could flip its holdings on Ethereum on-chain activity.
Source: Santiment
In a recent tweet, analyst Ali Martinez claimed that Ethereum holdings have massively increased among ETH whales. He stated that addresses holdings between 1000 – 10000 ETH have added more than 320,000 ETH to their holdings in the past month.
This lot is worth over $416 million and represents increasing investors’ confidence in the Merge. It also shows that falling prices in the past weeks have provided a strong buying opportunity for stacking right now.
Source: Ali Martinez/ Twitter
Here’s the problem
Notably, Ethereum’s network is facing serious issues at the moment. In a tweet, Martinez claimsed that “Ethereum’s network growth hasn’t been this low in more than two years.”
The last time Ethereum saw such low daily new addresses were just below 50,000 back in March 2020.
Historically speaking, a decline in new address creation on Ethereum tends to a “steep price correction” over time.
Source: Ali Martinez/ Twitter
Martinez also pointed out two crucial supply zones according to on-chain data. He picked out $1,475 as the first zone where over 585k addresses bought 2.81 million ETH.
The other stood at $1,560 where 526k addresses held 3.44 million ETH.
According to him, the only “considerable support level is $1,335 where 412k addresses have purchased 2.2 million ETH.”
Source: Ali Martinez/ Twitter
Conclusion
Trading at $1,571, at press time, ETH has seen a sudden recovery in the past day as markets saw some respite.
In the past 24 hours alone, Ethereum has increased by over 8% according to CoinMarketCap. Surely, the anticipation surrounding the Merge is adding to the price hikes on Ethereum.
