Ethereum (ETH) appears to be following the trend set this July.
According to CoinGlass data, July has been one of the strongest months for ETH, with returns averaging 10%. Bitcoin (BTC), meanwhile, is up nearly 7% over the same period, giving ETH a seasonal edge. Based on this, Token Terminal’s latest report adds another layer to the bullish setup.
As the chart below shows, the number of Ethereum weekly has increased to 18.7 million, while the average price has decreased to only $0.008. High usage combined with low fees is a strong sign that the Ethereum upgrade is finally paying off.
In support of this, another report showed a significant increase in software applications. New shipments of smart contracts are up nearly 192%, with another 57% jump in the last week alone. A growing number of developers along with network user records to improve the requirements below Ethereumrecent meeting.
Historically, this type of setup has often inspired large gatherings. This is why a move of ETH above $2,000 seems possible. The idea is simple: Capital does not just flow in ETH. In fact, it’s also running on chains, meaning investors are doing more than just chasing value. However, CryptoQuant is not entirely sure.
According to his latest reportEthereum’s Perp Futures-to-spot Volume Gap on Binance remains high, although the Z-score continues to cool. In other words, utility is still greater than land demand. CryptoQuant noted that much of ETH’s recent price increase appears to be driven by futures rather than consistent buying from long-term investors.
This brings up a very important question: Has the market been too optimistic about the end of Ethereum?
Ethereum’s competition is facing its biggest test yet
Binance is the most important exchange to watch.
Interestingly, stablecoin flows to Binance have jumped nearly 370%, reaching $58 million per day. In short, instead of moving on the chain, most of the capital remains in the exchange, meaning that investors have the opportunity to follow rather than send money immediately.
However, there is another side to the story. As the chart below shows, Binance Funding has risen again, now sitting 200% above its 90-day base. This shows that traders are increasingly taking advantage of the opportunity, meaning that a large part of the new product may continue in the future instead of the spot market.
This is in line with the latest CryptoQuant report.
With the deployment of smart contracts by 192%, the construction of stablecoin liquidity, and the increase of funds by 220%, three main signs are now moving together: a strong construction project, new funds waiting on the sidelines, and a strong rise. It’s a bullish setup, but one that relies heavily on traders who are in trouble.
However, demand for land from long-term holders is not there. This suggests that traders may be more optimistic about Ethereum breaking above $2,000. Until buyers step in, the rally may remain vulnerable to a power-driven retreat.
Brief Summary
- The Ethereum platform is supported by strong blockchain services and developer adoption.
- But rising power and weak demand for space could make the breakout less likely.
