Increasing investor optimism drives Ethereum to a 20-month peak.
The price of Ethereum (ETH) has been steadily rising since mid-October and recently surpassed the $2,200 mark for the first time since the Terra collapse in May of last year.
As of the time of writing, ETH is up by 3.8% in the past 24 hours and is trading at around $2,250, reaching its highest level in 20 months. The market cap of ETH has also increased to $270 billion, with a market dominance of 17.3%.
In addition to the price surge, Ethereum’s 24-hour trading volume has seen a 15% increase, surpassing $11 billion.
Data from the market intelligence platform Santiment reveals that the number of wallets holding between 0.1 and 1 ETH has reached a 14-week high of 3.35 million, a level last seen in mid-August.
Conversely, the number of whale wallets, which consist of 100 to 1,000 ETH, has been consistently declining since early March and currently stands at 40,779 unique addresses.
Furthermore, Santiment data shows that ETH’s total open interest (OI) has been steadily rising since November 26. The total OI has increased from $4.4 billion on December 3 to $4.43 billion at the time of writing.
As the price of ETH surged, so did the whale activity. According to Santiment’s data, the number of whale transactions worth at least $100,000 worth of ETH increased by 4.3% in the past 24 hours, from 3,343 trades on December 3 to 3,484 unique transactions at the time of reporting.
The bullish momentum in ETH is attributed to the asset’s supply becoming deflationary due to a decrease in validator participation. The number of Ethereum validators leaving the network has been decreasing, resulting in a slower token issuance rate.
Ethereum co-founder Vitalik Buterin has previously acknowledged the network’s staking and decentralization issues. However, Buterin has stated that these issues will be addressed in the upcoming Dencun upgrade, which aims to make the Ethereum blockchain more decentralized.
Overall, the recent price surge and increase in whale activity indicate positive market sentiment for Ethereum, with investors showing confidence in the future of the network.
