exception Ethereum’s fluctuating price action Another key area has been gaining notable attention in the sector over the past few weeks following widespread market volatility. The price of ETH is showing a downward trend, while its supply dynamics are also showing a negative trend.
Net negative Ethereum supply continues
Despite the current market weakness, supply dynamics are Ethereum It's signaling a quiet but powerful signal for the market. Leon Waidmann, market expert and On-Chain Foundation research director, examined the supply dynamics of the asset in a post on social media platform X. release Continued negative trend.
On-chain data indicates: Ethereum supply As you can see in the chart shared by Waidmann, it has remained net negative despite continued price fluctuations. The data also shows that the metric is trending negatively over the past seven days.
If Ethereum's supply dynamics remain negative, this simply means that more ETH is removed from circulation than is added to the market. This pattern is the result of constant network activity, ongoing fee burning, and increased demand for long-term holding and staking.
Over the course of seven days, Waidmann highlighted that more than 30,000 new ETH were added to the market. meantime, Spot Ethereum Exchange Traded Fund (ETF) Over 67,100 ETH has been accumulated, and approximately 11,700 ETH has been burned through network fees.
In total, this changes the net supply of the network to -49,800 ETH. Therefore, the number of ETH removed from circulation was 2.7 times more than was issued on the market during that period. What this means is that demand for ETH currently continues to structurally outstrip issuance.
Typically, an increase in market demand precedes an increase in prices. However, the ETH price failed to react in this direction. Waidman pointed out that prices are not moving yet because most demand is passive and not price chasing.
Therefore, experts first declare absorption before a breakout occurs later. Moreover, large holders are still allocating to the rally, limiting short-term moves. Another reason is derivativesThis is because they often set marginal prices rather than spot flows.
During negative supply dynamics, the floor is usually tightened before the ceiling is lifted. Weidman highlighted a market structure in which supply breaks first, followed by price, a clear pattern for how bases are formed.
ETH network throughput reaches historic highs.
Recent updates have brought the Ethereum network back to life at a rapid pace. Cryptocurrency enthusiast Joseph Young said: shared It marks a new milestone for ETH as the network's execution throughput surges to an all-time high. The newly released Fusaka upgrade drives the network's recent spark..
After the key update was introduced, Young said: ETH mainnet capacity It's doubled, and rollups like Base are already handling 10 times that run. According to Young, rollups scale up production and ETH scales rapidly, reinforcing the growing notion that ETH is a financial settlement layer.
Featured image from Freepik, chart from Tradingview.com
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