Ethereum Network Shows Signs of Growth Amid Regulatory Uncertainty and Underperforming Price: IntoTheBlock
According to market intelligence firm IntoTheBlock, Ethereum (ETH) is demonstrating growth despite its underperformance and the regulatory uncertainty surrounding it. The platform’s head of research highlights that Ethereum volumes are reaching levels not seen in years, indicating positive development.
IntoTheBlock reveals that this week, the amount of ETH transferred on Ethereum’s mainnet reached its highest point since May 2022. Additionally, the amount of ETH on layer-2 scaling solutions recently exceeded 10 million for the first time ever.
Layer-2 Activity Surpasses Ethereum Mainnet
- Activity on layer-2s Arbitrum (ARB), Optimism (OP), and Base (BASE) is more than double the rate on Ethereum’s mainnet.
- ETH fees dropped by 90% after the Dencun update on March 13th, leading to increased activity on layer-2 blockchains.
Despite its growth, Ethereum has lagged behind Bitcoin (BTC) and the S&P 500 during this cycle. However, in terms of on-chain data, Ethereum continues to show positive growth.
Regulatory Uncertainty Surrounding Ethereum
The regulatory uncertainty surrounding Ethereum adds to its challenges. Earlier this month, Gary Gensler, Chairman of the U.S. Securities and Exchange Commission (SEC), declined to comment on whether Ethereum is considered a security or a commodity. This uncertainty affects the second-largest digital asset by market cap as the SEC is still deciding whether to approve several proposals for ETH-based exchange-traded funds (ETFs).
Ethereum is currently trading at $3,333, with a 3.75% decrease in the last 24 hours.
Hot Take: Ethereum Network Continues to Grow Despite Challenges
Ethereum’s network is displaying signs of growth, indicating its resilience and potential for the future. Despite criticisms and underperforming price, Ethereum’s on-chain data reveals positive development. Here are the key takeaways:
Signs of Growth
- Ethereum volumes are reaching levels not seen in years, demonstrating growth.
- The amount of ETH transferred on Ethereum’s mainnet recently reached its highest point since May 2022.
- Over 10 million ETH is now on layer-2 scaling solutions.
Layer-2 Activity
- Activity on layer-2s Arbitrum, Optimism, and Base is more than double the rate on Ethereum’s mainnet.
- ETH fees dropped by 90% after the Dencun update, leading to increased activity on layer-2 blockchains.
Lagging Behind Bitcoin and S&P 500
Ethereum has not performed as well as Bitcoin or the S&P 500 during this cycle. However, it continues to grow in terms of on-chain data.
Regulatory Uncertainty
The regulatory uncertainty surrounding Ethereum adds challenges to its growth. The SEC is still deciding whether to approve ETH-based ETFs, and Chairman Gary Gensler declined to comment on whether Ethereum is considered a security or a commodity.
Ethereum’s current market price is $3,333, with a slight decrease in the last 24 hours.
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