- Ethereum’s dominance against Bitcoin continues to grow.
- Behind the asset’s rise are strong on-chain fundamentals.
- Ethereum has gained increased attention amid ETF speculations.
After lagging behind Bitcoin in 2023, market tailwinds are shifting Ethereum‘s way. The second largest crypto asset by market cap has so far outperformed the market leader in 2024, with on-chain metrics suggesting that the asset is showing further signs of strength.
Ethereum Addresses Soar, Exchange Deposits Plummet
In an X post on Tuesday, January 16, crypto analytics firm Santiment Feed highlighted that Ethereum’s price dominance has gained over 22% against Bitcoin in the past week. Behind this surge, the analytics firm observed that the network was showing strong fundamentals.
📈 #Ethereum's price dominance continues to surge against #Bitcoin's, now +22.4% in a week. During this stretch, there have been 89.4K new $ETH addresses created per day, and 96.3K wallets just yesterday. Additionally, the 2nd largest market cap asset's supply on
(Cont) 👇 pic.twitter.com/9nHCl6PJPy
— Santiment (@santimentfeed) January 16, 2024
Ethereum has averaged nearly 90,000 new addresses daily within this period, with the network reportedly adding over 96,000 on Tuesday, January 16. At the same time, the asset’s supply on exchanges is plummeting. According to Santiment, this metric is now approaching all-time lows of 8.05%.
These on-chain metrics are significantly bullish for Ethereum as they suggest increasing demand and declining supply. They come as investors speculate on the chances of the SEC approving spot Ethereum ETFs and anticipate the benefits of the Dencun upgrade expected to go live in Q1 2024.
Ethereum ETFs Coming Soon?
Following the SEC’s approval of spot Bitcoin ETFs, there has been increasing speculation that the agency would also do the same for Ethereum-backed products. Most of the firms that recently received the agency’s approval to launch Bitcoin ETFs are also in the race to launch the Ethereum version. They include BlackRock, Fidelity, Ark 21Shares, and VanEck.
BlackRock CEO Larry Fink recently stoked speculations by offering high praise for the asset underpinning the second-largest blockchain by market capitalization. He described Ethereum as a “store of value,” adding that he believed that it held significant potential.
At the moment, all eyes are on May 23, when the SEC is scheduled to issue a decision on VanEck’s application.
On the Flipside
- At the time of writing, CoinGecko data shows that Ethereum is still about 48% below its all-time high of nearly $4,900.
- SEC Chair Gary Gensler noted that the approval of Bitcoin ETFs did not guarantee that the agency would also approve other crypto-backed securities or change its stance on the nature of other crypto assets in ongoing lawsuits.
Why This Matters
Ethereum’s strong fundamentals increase the chances of the asset continuing its uptrend and the current outperformance of Bitcoin.
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