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11 August 2022
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Ethereum News Today – Headlines for June 27

  • The growth of the DeFi has positively impacted Ethereum’s userbase
  • Ethers gas usage has gone higher in recent weeks
  • DeFi investors will likely move their gains to Ethereum

Ethereum News Today – recently investors have been shocked by the divergence between the price action of Ethereum and its fundamental growth. ETH’s robust on-chain data have achieved great things despite being exposed by Bitcoin’s downside. One explanation for the current trend is the explosive growth of DeFi, even though beneficial, does not lend itself to ETH’s value immediately.

Even though it has been driving users and transaction volume to Ethereum. Looking beyond Ethereum’s technical prowess, experts have noted that four notable metrics on ETH are well-positioned to post further upsides in the long-term. They are likely behind the recent strong on-chain fundamentals.

DeFi Drives Massive Userbase Growth on Ethereum

The DeFi sector has seen its popularity grow which has in turn driven massive on-chain growth for the Ethereum Blockchain. This growth has happened gradually during the last few months. Although it went parabolic last week. This was because of the long-awaited launch of COMP (Compound). The launch of COMP gave rise to the yield farming trend. Here users leverage ERC-20 tokens to receive huge DeFi incentives.

At some point, the incentives reached 200% per annum. It is paramount to note that this current trend doesn’t directly lead the price of Ethereum to accrue more to its value. However, it has given the network’s fundamental strength a much needed huge boost. One such metric that indicates this conclusion is ETH’s daily transaction count. This metric just surged over the 1 million marks for the first time since 2018. Recall that between late 2017 and early 2018 was the peak of Ethereum’s historic bull run.

DeFi Investors Will Likely Move Their Gains To Ethereum

Ethereum’s co-founder and others are concerned that the current DeFi trend will soon end harshly because it is driven by investors who are chasing massive returns. According to Spencer Noon who serves as the head of DTC Capital in a recent tweet, the crypto’s velocity, the accounts sending ETH, gas used, and token age consumed, have all gone higher in recent weeks. The DTC Capital chief referenced data from Santiment a Blockchain analytics firm. Here is his tweet:

A large number of Ether on-chain health indicators are close to ATHs. Including Velocity, Accounts, daily transactions and Token Age Consumed or Gas used.”

The factors mentioned here probably won’t be enough for the digital asset to break the tight correlation with Bitcoin. However, these fundamentals bolster Ethereum’s macro outlook. Investors who have been making huge gains via multiple DeFi initiatives may start cycling their profits into the ETH network. This providing the network with the much-needed buying pressure it has been lacking.

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