As ETH fell to the $4,000 level, small Ethereum investors increased their exposure

As ETH fell to the $4,000 level, small Ethereum investors increased their exposure


Ethereum’s native token Ether (Ethereum) After hitting an all-time high of around US$4,867 on November 10, it has fallen by more than 18%, and the current transaction price is close to US$3,900. Nevertheless, the plunge did not prevent retail investors from buying small amounts of tokens.

Based on the collected data Glass node ——Blockchain analysis platform. On December 4 of the same day, the number of Ether addresses holding less than or equal to 0.01 ETH reached a record 19.95 million ETH fell to $3,575 (Data from Coinbase).

An Ethereum address with a balance less than or equal to 0.01. Source: Glassnode

At the same time, despite the correction of Ether from US$4,867 to US$3,575, the number of Ethereum wallets with a balance of at least 0.1 ETH is also rising, and finally hit a record high of US$6.37 million on December 12.

As a result, the quantity Ether address with non-zero balance It also set a record high of nearly 70 million on December 12. In contrast, addresses holding less than or equal to 1 ETH fell along with the price, indicating that they are not very interested in buying ETH on dips.

An Ethereum address with a balance less than or equal to 1 ETH. Source: Glassnode

Rebound early?

Retail investors buy Ether in small batches Ethereum price Descend to the support confluence.

It is worth noting that Ethereum plummeted by more than 5% on Monday to nearly $3,900, inspired by similar corrections in the entire cryptocurrency field. Nonetheless, the ETH price has reached an area that has recently attracted buyers.

Support Confluence’s ETH/USD daily price chart. Source: TradingView

The first support comes from the downtrend line of the descending channel pattern-the black range shown in the figure above. At the same time, the purple 100-day simple moving average (100-day SMA) and the red retracement area (which has been the case since October 20) increase the potential for Ether to retrace upwards in the short term.

Although smaller retail investors seem to have been increasing their holdings of Ether, larger retail investors seem to be contradictory.

An Ethereum address with a balance less than or equal to 1,000 ETH. Source: Glassnode

For example, Glassnode data shows that buying interest is in An Ethereum wallet with a balance of at least 1,000 ETHNevertheless, overall, their number has dropped from nearly 7,200 to less than 6,350 in 2021.

Ether balance of the exchange

More upside clues come from the decline in the balance of Ether on all cryptocurrency exchanges.

Since December 9th, the number of tokens held on exchanges has recovered from nearly 14 million ETH to 14.13 million ETH-while the price has fallen by nearly 10.50%-but its long-term trend still exists Downward.

Ethereum balance and ETH price on all exchanges. Source: Glassnode

The low ETH balance between exchanges implies that traders intend to hold their tokens or pledge them in a decentralized financial pool (Go to financial institution) Projects that earn income, rather than exchange them for other assets.

related: Data shows that professional traders are currently more optimistic about Ethereum than Bitcoin

According to data provided by Defi Llama, DeFi’s total lock-up value (TVL) hit a record high of more than 250 billion U.S. dollars, of which the TVL of Ethereum exceeded 180 billion U.S. dollars.

The total capital locked in the entire Ethereum ecosystem. Source: Defi Llama

“However, Ethereum’s dominance of DeFi activities has been severely hit in the second half of 2021,” Delphi Digital, an investment company focused on cryptocurrencies, reminded, adding:

“As the multi-chain narrative unfolds, capital has been transferred to ecosystems such as Solana, Terra and Avalanche.”

High oil prices have always been the main reason investors seek potential “Ethereum killers.”

For example, decentralized exchange swaps cost $70 on Ethereum and $1 on Terra and Solana.However, some analysts expect that Ethereum’s Complete transition from proof of work to proof of equity The high gas problem will be solved next year.

“Due to the shift in proof of stake, the price of Ethereum will rise at a much faster rate than Bitcoin,” famous Tom Higgins, CEO of the asset management platform Gold-i.

The views and opinions expressed here only represent the views of the author and do not necessarily reflect the views of Every investment and trading action involves risk, and you should conduct your own research when making a decision.