However, fundamentals for the asset and network are as strong as ever.
On Aug. 11, crypto industry and DeFi analyst Miles Deutscher highlighted some of Ethereum’s bullish fundamentals.
“It’s hard not to be ridiculously bullish on Ethereum,” he said.
Ethereum Fundamentals Strong
Firstly, some of the world’s largest companies, such as PayPal, have chosen Ethereum to launch their products. Earlier this week, Ethereum advocate Ryan Sean Adams said the network is “becoming the money layer of the internet.”
Worldcoin is also using Ethereum and could be a major gas consumer if the digital ID project takes off.
It’s hard not to be ridiculously bullish on Ethereum.
Here are 9 reasons why.
• The biggest new projects are choosing to launch on ETH (PayPal stable coin, Worldcoin etc.)
• The ETH L2 thesis only continues to gain traction: Base launch, TVL at highs + strongest funding of…
— Miles Deutscher (@milesdeutscher) August 10, 2023
The Ethereum layer-2 ecosystem is also growing at an accelerated pace, with networks such as Coinbase’s Base launching on L2. According to L2beat, total value locked across the ecosystem has surged 150% since the beginning of the year to an all-time high of $10.5 billion.
Additionally, EIP-4844 is on the horizon, which will substantially reduce fees on layer-2 networks.
Ethereum staking continues to grow, with almost 20% of the entire supply, or $42.5 billion worth of ETH, now staked and securing the network.
Furthermore, Ethereum’s total fee revenue is higher than all other protocols combined.
Ethereum issuance remains deflationary, with the total supply declining by around 303,000 ETH since the Merge in September 2022.
Visa, one of the world’s largest payment processors, continues to use Ethereum for their crypto research.
Yesterday they published a proof of concept that allows users to pay gas fees using credit cards by leveraging Account Abstraction (ERC4337).
Here’s how it all works 🧵: pic.twitter.com/rYjTlBkdkW
— cygaar (@0xCygaar) August 11, 2023
Deutscher also pointed out that NFT collections were migrating to Ethereum, citing Degods and y00ts as examples.
Many layer-1 networks are pivoting back towards Ethereum, such as Fantom adding Optimism rollups and Frax launching a layer-2.
Ethereum has also been labeled as a commodity by the Commodity Futures Trading Commission though Congress has yet to officially classify the asset.
Finally, a slew of Ethereum-based ETFs have been applied for, so it could be only a matter of time before they get approved.
📈 #Ethereum $ETH Realized Cap just reached a 8-month high of $181,571,901,762.15
Previous 8-month high of $181,571,219,723.97 was observed on 11 August 2023
View metric:https://t.co/JEcbTHEjsD pic.twitter.com/KslqrJW7a4
— glassnode alerts (@glassnodealerts) August 12, 2023
ETH Price Outlook
These ten solid fundamentals should be moving ETH prices, but they’re not at the moment.
ETH is hovering around the $1,850 level, where it has been for the past seven weeks, aside from a brief spike in mid-July.
The asset has mirrored Bitcoin, trading in a range-bound channel since the middle of March.
A larger move higher is expected when BTC finally breaks out of consolidation, and there are several factors that could catalyze this.
There are many reasons to be bullish about Ethereum, and a move higher seems an inevitability sooner or later.