Weekly Onchain Insights: Ethereum Impressive Insights
The IntoTheBlock newsletter highlights weekly interesting data points about the crypto markets.
Every week the IntoTheBlock team publishes a newsletter that summarizes key data insights about the crypto market. Below is a quick summary.
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Hey onchainers,
Welcome back to IntoTheBlock’s newsletter. We have created a different type of newsletter for crypto fans that is not about news, but about data and analytics. Every week, we deliver valuable data insights about the crypto market.
Bitcoin Price Analysis: $11,813.69 (6:00am EST 08/07/2020)
What does In/Out of the Money mean?
For any address with a balance of tokens, ITB identifies the average price (cost) at which those tokens were purchased and compares it current price.* Showing information for addresses that bought between $9,462 and $12,841
At the moment of writing, Bitcoin is trading at $11,813.69 and using our In/Out of the Money Around Price (IOMAP) we were able to identify that if sells order begin to pile up, the $11,600 mark could act as strong support with 788 thousand addresses that had previously purchased a total of 645 thousand BTC. The largest level of support is located between $11,100 and $11,450, where roughly 1.27 million addresses previously bought 660 thousand BTC at an average price of $11,304.
Looking at the level of resistance, there isn’t any major supply barrier that could impede BTC from rising to $13,590 if demand were to continue.
IntoTheBlock Special Edition: Ethereum (ETH) Impressive Insights
A lot has happened in the Ethereum blockchain since the last time ETH was above $400. Through all the developments that have happened in the last twelve months — from a pandemic to a Cambrian explosion in yield farming initiatives — the Ethereum blockchain has managed to accelerate its growth and usage.
In this edition, we will dive deeper into some key metrics assessing the current state of the Ethereum blockchain and its evolution throughout this year.
Ethereum reached $400 for the first time since August of 2018
Currently trading at $396, Ether crossed the $400 barrier for the first time on August 2, according to data of our trusted partner, CoinMarketCap. The last time the crypto-asset was trading above $400 was on August 6 of 2018.
It has been a great year for Ethereum, with DeFi and Ethereum 2.0 driven the price up 203% YTD. Not only that, but Ether has also been on an intense uptrend since July 20, setting fresh 2020 highs with a 67% return in just 26 days.
See the Ethereum Mid Price Chart
Over 75% of the addresses are profiting on their ETH position
What does In/Out of the Money mean?
For any address with a balance of tokens, ITB identifies the average price (cost) at which those tokens were purchased and compares it current price.* Showing information for addresses that bought between $9,462 and $12,841
IntoTheBlock’s Historical In/Out of the Money (HIOM) indicator analyzes investors’ on-chain positions based on addresses’ average cost for a token, in this case ETH. Based on this, the HIOM calculates the percentage and the total number of addresses that are “in the money”, or profiting on their positions on paper. By comparing variations in the HIOM over time, we can determine buying/selling activity based on the number of addresses profiting at a specific price level.
The last time ETH prices were above $300, 13.5 million addresses (less than 50% of all holders) were in the money. Comparing these numbers to the ones observed as ETH surpassed the $300 barrier a few days ago, we see that the number of ETH holders profiting at a price of $310 has more than doubled.
As Ether continues to hit new 2020 highs, over 75% of addresses currently holding ETH are reportedly profitable. This massive increase signals that millions of new addresses bought ETH below $300. Additionally, since the growth in addresses profiting is greater than the increase in the total number of ETH addresses with a balance, we can establish that approximately 1 million previous ETH holders opted to bring their average cost down.
See Ethereum’s Historical In/Out of The Money
Ther are more addresses holding ETH than those holding BTC
What does Total Addresses With Balance mean?
ITB substracts those addresses that have no balance from the total number of addresses in the network to arrive at those addresses that actually have a balance,
The Ethereum network has seen explosive growth throughout 2020. As can be seen in the graph above, the total number of addresses with a positive balance of Ethereum grew more than 10 million during 2020. To put things in perspective, during the entire year 2019, Ethereum added 12.89 million addresses with a balance, which means that the network is on pace to break a new record by the end of the year.
On August 5, a new record was established, as there are now 44.08 million addresses currently holding ETH. By comparing this metric to the Bitcoin network, we can establish that there are 13.09 million more addresses currently holding ETH than those holding BTC. This also means that the number of Ether addresses profiting (33.39 million) has now surpassed the total number of Bitcoin addresses with a balance (30.99 million). In other words, more addresses are making money in Ethereum than the total number of addresses holding Bitcoin.
ETH Transactions Reach its Highest Level Since January of 2018
What does Transactions mean?
ITB measures the number and volume of on-chain transactions in a given period.
As can be seen in the graph above, the number of transactions has been on a consistent uptrend throughout 2020. On July 27, the number of transactions on the Ethereum network reached a level not seen since January 3rd of 2018.
This growth in transactions highlights the increased demand to use the Ethereum blockchain, pointing to ETH’s utility value as infrastructure for a decentralized economy being significantly stronger than a year ago.
See Ethereum’s Transactions Chart
HODLING trend on Ethereum?
What does Ownership by Time Held mean?
Hodlers are passive investors that have held the asset for more than 1 year
At IntoTheBlock, we classify an address with a holding time of over one year as a hodler. As can be seen in the graph below, the number of ETH hodlers has increased by over 10 million within the last twelve months.
Our Hodlers indicator has continuously shown an almost linear growth every month, despite Ethereum’s price drop of about 50% back in March, it is now at about 24.87m addresses, an All-Time-High for this metric, and it represents 56% of the total ETH holders.
See Ethereum’s Ownership by Time Held Chart
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