Ethereum's price has been falling freely in recent days, losing nearly $ 200 in value at one point. According to a recent report, the price drop came shortly after the top 100 ETH exchange addresses dumped over 1 million tokens.
The recent ETH price decline predicted by the sell-offs?
Only until a few days ago, the price of ETH was on a roll. The second largest cryptocurrency by market cap soared to a 2-year high at around $ 490. With such an impressive bull run, the community wondered how long it would take for Ethereum to break above $ 500.
However, the situation was drastically reversed. Instead of hitting another high, ETH started to lose value pretty quickly. The asset first broke below $ 400 before bottoming out at about $ 310, losing about 35% in the process.
Data compiled from analytics company Santiment reveals that Ethereum's whales may have been ahead of the curve. As the price of ETH accelerated towards its recent high, the top 100 exchange addresses began to ditch their tokens.
Ultimately, the company concluded that those addresses "decreased their held tokens from 16.92 million to 15.89 million over the past week." This means a “significant” drop of more than 6%, which, according to Santiment, was “almost certainly a spark plug” for the massive price dump.
A recent report indicated that the number of developers using the network has increased since 2018. In fact, Ethereum-specific code packages downloaded in 2020 exceed the downloads of 2018 and 2019 combined.
Additionally, Medalla's testnet has attracted more than 1.1 million Test Ethers, a substantial increase over the previous week's numbers.
Medal serves as the final testnet before the official launch of the Ethereum 2.0 network, which aims to initiate the transition from the current proof-of-work consensus algorithm to proof-of-stake. The 38,000 active validators who have staked their ETH are already making a profit.
Ultimately, these developments have contrasting effects. While the increased usage means more and more users are employing the Ethereum blockchain, it also highlights notable issues.
The network has been jammed almost constantly. Ethereum's mempool shows more than 160,000 pending transactions at the time of this writing, which triggers fees on the network.
In early September, the average fees paid rose to the highest levels of around $ 6.60. ETH miners benefit the most from this as their profits skyrocket. However, users are waiting for the release of ETH 2.0 in the hope that it will improve their experience. If not, they might start exploring other options.