The second-largest cryptocurrency in terms of capitalization outpaced bitcoin in growth and inspired optimism for traders, but now it has dropped even more than BTC.
On November 10, Ethereum hit its all-time high with a price of $4858. However, the coin immediately began to decline after that, following the fall in bitcoin. ETH rebounded to $4,761 on November 15 but plunged nearly 15% almost immediately. The leading altcoin dropped to $4087 for a short time. Traders are suffering losses, while analysts had warned that Ethereum’s behavior was signaling a major decline. Research firm Santiment noted in its report Santiment Insights:
– We are seeing a strong divergence between price and trading volume. Price heading up, trading volume trying to pick up but fails and heading down.
Since September, Ethereum has actually been in a downtrend, the researchers note. The number of active addresses has also dropped since the end of October. On October 30, it was 675,500 and by now it has decreased by 17%. At the same time, according to Santiment’s analysts, the important indicator network profit / loss (NPL) is sharply decreasing too. This means that ETH hodlers sell at a loss on average. Overall, the firm has recommended that players follow the bearish sentiment for Ethereum. The final statements of the report turned out to be prophetic:
– We see network activity going down even though the price is pushing up. People [are] too relaxed to take profits even though ETH is going up (visible in NPL). There is a good chance they will be punished.
However, the experts did not take into account that the players were inspired by the generally positive sentiment regarding the platforms for smart contracts. Several new projects such as Solana (SOL), Cardano (ADA), Polkadot (DOT) declined slower than the market. And the fastest platform for smart contracts Avalanche (AVAX) does not fall at all this time and is in a bullish trend.
Optimism for the players was added by the news that two Ethereum-based altcoins appeared in the Coinbase Pro listing: Powerledger (POWR) and Gala (GALA). POWR is a utility token for managing electricity sales. GALA is a token of the gaming platform, which allows players to manage in-game items and determine the direction of the game’s development.
Both tokens grew rapidly after listing: POWR – by 120%, GALA – by almost 50%. The success of the Shiba Inu (SHIB) meme coin, which also operates on the Ethereum network, is inspiring too. SHIB has grown by millions of percent over the year.
It is not clear how long the fall of the leading altcoin will last. However, there is no doubt that hodlers will win in the long run. Traders have learned a good lesson and will now be more attentive to the market signals.