The recent launch of spot Ether (ETH) exchange-traded funds (ETFs) in the United States hasn’t been all sunshine and rainbows. Grayscale’s Ethereum Trust (ETHE), a prominent player in the space, experienced a concerning trend of consistent outflows since its debut on July 23rd. However, there’s a glimmer of hope on the horizon. As of August 12th, ETHE finally recorded its first day with zero outflows, marking a potential turning point for the fund.
This development coincides with a surge in activity on the Ethereum network itself. Decentralized exchanges (DEXs) built on Ethereum, like Uniswap, and its layer-2 scaling solutions have witnessed a significant uptick in usage. Uniswap, a leading DEX, saw a record number of new addresses created on layer-2 networks in July, nearly double the figure from the previous month. This data suggests growing user interest and potentially increased demand for ETH.
The Ethereum ecosystem isn’t the only one buzzing. While trading volumes on Solana-based DEXs dipped, Ethereum and its layer-2 network, Base, experienced a healthy rise in activity. This shift indicates a potential migration of users towards Ethereum, further bolstering its position.
The overall network activity on Ethereum layer-2 solutions is also heating up. The number of transactions processed per second (TPS) reached 298 on August 12th, just shy of the all-time high set in July. This signifies a busy network with high user engagement.
The combined value locked (TVL) across all Ethereum layer-2 protocols currently sits at $37.7 billion, showcasing the significant amount of capital deployed within the network. This, coupled with the $85 billion TVL on Ethereum’s (ETH) mainnet, paints a picture of a robust and thriving ecosystem.
Also Read: Is Ethereum Poised For A Rebound? Futures Data Hints At A Possible Uptrend
Bullish Signs On The Horizon?
Analysts are cautiously optimistic about the recent developments. The dwindling outflows from ETHE, coupled with the surge in on-chain activity, could be a catalyst for a price increase in Ether. Some analysts even suggest that ETH’s price trajectory might mirror Bitcoin’s (BTC) performance following the launch of spot Bitcoin ETFs, which also experienced initial outflows.
Time will tell if this is a temporary blip or a genuine shift in sentiment. However, the increased activity on the Ethereum (ETH) network and the halt in ETHE outflows are undoubtedly positive signs for the future of the world’s second-largest cryptocurrency.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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