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It has been more than 2 weeks since the Ethereum merger happened. However, the hype that existed prior to the event quickly died down as the event was followed by a loss of interest in cryptocurrency. Glassnode recently confirmed this finding after seeing a sustained decline in ETH open interest in perpetual futures.
Here is AMBCrypto’s price prediction for Ethereum [ETH] for 2023-24
The amount of ETH Open Interest in perpetual futures recently fell to its lowest level in 4 weeks. This seemed to be a sign of a decline in demand from the derivatives market, which generally mirrors results in the spot market.
📉 #Ethereum $ETH Open interest in perpetual futures just hit a one-month low of $239,630,633 on #Debit
Show metric:https://t.co/5MhXAkWLAZ pic.twitter.com/S1gS88PYqj
— glassnode alerts (@glassnodealerts) October 5, 2022
ETH’s on-chain metrics highlighted similar observations in the spot market.
For example, the amount traded has slowed significantly over the past few weeks, even now at a 6-month low. Exchange withdrawal addresses have particularly fallen since late September.
Source: CryptoQuant
The observed drop in exchange withdrawal addresses would traditionally be the case during a sale. This indicates weak demand and would be accompanied by an increase in exchange deposit addresses in bearish market conditions. However, exchange deposit addresses seemed to suggest low activity.
The aforementioned observation confirms that the selling pressure is also weak, which explains the price development of ETH. The latter has been on the side for a few days, as we will see later. Meanwhile, the sighting also means investors, especially whales, are sitting on the sidelines.
Source: Glassnode
ETH addresses holding more than 100 ETH (whales) have been unloading their holdings since mid-September. Their outflows have tightened in recent days, explaining the recently observed drop in volumes and price movements.
Relaunch demand for ETH
Descending outflows from whale addresses may suggest that ETH is about to usher in the bulls. Additionally, active addresses fell to their lowest level on October 3, but have since risen slightly.
Source: Glassnode
This pivot in the number of active addresses could be a healthy indication that demand for ETH is about to recover.
Conclusion
ETH has been struggling to recover the $1400 price level since the last week of September. This, after getting rid of the selling pressure that has persisted since the merger. This performance likely reflects a cautious outlook as investors stay on the sidelines to gauge post-merger performance. Perhaps, due to expectations of a deeper sell-off in case the Ethereum network experiences challenges in its new state.
The Ethereum network has not reported any issues so far and the post-merger selling pressure has eased. These conditions could perhaps contribute to the return of investor confidence.
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