Ethereum (ETH) is on the Rise in 2020 Giving Strong Indicators for the Future.
Contents:
Address growth is often an influential factor.
Price security is likely to enable ETH’s addresses to rise.
The growth rate of the ETH platform is rising noticeably even though the drop in ETH’s price over the past few weeks. It implies that the future of ETH remains strong.
At the start of 2020, Experts have ETH addresses showing a rise from around 40,000 to over 70,000 over the past four months, implying that more consumers are using the ETH blockchain platform.
Address Growth is Often an Influential Factor.
For any blockchain platform, the individual address growth is an elemental factor for its medium to long-term growth.
Expert investors the likes of Brian Kelly, CEO of brian kelly capital management, have typically used this data to predict the price trends of the main cryptocurrencies including ETH and Bitcoin.
Experts Have Said:
“This is a key indicator of ETH’s long-term potential continuing to look promising. Network growth shows the number of new addresses being created on the project’s respective network each day. Essentially, this chart illustrates user adoption over time, and can be used to identify when the project is gaining or losing traction.”
Since late last year, the huge rise in the usage of decentralized finance (DeFi) platforms for loans by using ETH as security has increased the demand for ETH.
As the DeFi market rebounds from the sudden crash of the cryptocurrency markets on March 12, which saw the Bitcoin price drop to as low as $3,600, looking forward the ETH blockchain platform is predicted to see stable recovery moving into the second half of 2020.
Price Stability Will Likely Cause ETH Addresses to Increase.
According to data from experts, the total value tied in DeFi platforms has reduced by nearly half from $1.2 billion to $600 million since the middle of March.
As lots of DeFi loans were liquidated and margin called, it has compelled a large volume of borrowers to close out their loans, the impact caused the DeFi market to contract.
When the DeFi market begins to rebound, this is likely to happen when we see the price of ETH recover, this should cause a knock-on effect an increase in user activity.
If the number of users increases over the next few months on DeFi platforms, this will continue to support the ETH platform to expand, raising the volume of individual addresses in the protocol.
However, whether the price of ETH and the rest of the crypto market have sufficient fundamental factors to drive a prolonged increase remains uncertain.
Experts have suggested that the V-shape rebound of Bitcoin from $3,600 to $6,700 implies the entire crypto market is vulnerable for another sharp correction, possibly a retest of the $4,000 to the $5,000 range.
Another downturn to the major cryptocurrencies could pose a threat to ETH’s platform growth in the short-term, as it could reduce the confidence of the everyday users of decentralized applications.
