On-chain data shows that the Ethereum network has been observing high address creation recently, a sign that adoption could be going up.
Ethereum Network Growth Has Registered High Values Recently
According to data from the on-chain analytics firm Santiment, ETH’s network growth has now hit its highest level in around four months. The “network growth” here refers to a metric that keeps track of the total amount of new addresses that are being created on the Ethereum blockchain.
When the value of this metric is high, it means that a large amount of new addresses are coming online on the network. New addresses may be considered analogous to new users joining the chain, so this kind of trend can be a sign that the cryptocurrency is observing high adoption at the moment.
On the other hand, low values of the indicator can imply not many new investors are coming to the network as there aren’t many new ETH addresses being created. Such a trend can be a sign that the asset isn’t looking very attractive to the general public currently.
Now, here is a chart that shows the trend in the Ethereum network growth over the last few months:
Looks like the value of the metric has been quite high in recent days | Source: Santiment on Twitter
As displayed in the above graph, the Ethereum network growth has been observing a rise recently. This would suggest that addresses are being created at increasingly faster rates right now.
Generally, adoption picks up during periods of high price volatility as the investors usually find such price action exciting, and so, the network growth indicator can register a spike.
Recently, however, the asset’s price has been mostly moving sideways below the $1,900 level, making it interesting that the indicator has been going up nonetheless. Perhaps the general investors saw the rally that lead up to this period of consolidation and now think that it may pick up again eventually.
During the past week alone, the metric has seen a combined value of 550,800, meaning that 550,800 new addresses have just been created on the Ethereum network in this period.
Usually, adoption can have a constructive effect on the cryptocurrency’s price, as it shows increasing interest in the asset, which is generally also accompanied by an influx of more capital into the coin.
Though, the impact from such a growth in the network doesn’t usually immediately appear; the effect on the cryptocurrency’s market cap may be visible in the long term.
Still, the adoption accelerating while the rally has slowed down to a crawl can be a positive for those hoping to see the price surge restart, as it at least means that interest in the asset hasn’t died down yet.
At the time of writing, Ethereum is trading around $1,800, down 1% in the last week.
ETH has been mostly moving sideways recently | Source: ETHUSD on TradingView
Featured image from Kanchanara on Unsplash.com, charts from TradingView.com, Santiment.net