The Ethereum network has been seeing a lot of activity in 2020.
The price of Ether already seems to lead the altcoins rally, currently trading at $221, up over 3.8%. The digital asset is also recording 70% gains YTD, more than double the bitcoin’s gains.
— Jonny Moe (@JonnyMoeTrades) May 28, 2020
The whales also continue to accumulate.
Ether whale addresses have hit a 10-month high with the cumulative holdings of the top 100 non-exchange wallets now owning more than 21.8 million Ether, worth about $4.5 billion.
“This is the largest collective balance held within the top 100 addresses since May, 2019,” reported Santiment.
As a matter of fact, in the past two days, these top whale addresses added an additional 145k Ether, worth over $30 million.
Recently, the network usage also hit a new high this week with the fees surging to $0.663 last week which now remains above $0.55. The last time the average Ethereum transaction fees were this high was on March 12 when the prices crashed and before that in March 2019.
Higher fees point to more sustainability, “allowing a blockchain to rely less on new coin issuance for security over time.” Moreover, this could lead to Ether’s net issuance to decline.
This uptick in network usage and fees has been recorded while ERC-20 tokens approach 50% of the total value stored on the Ethereum blockchain.
This transformation happened over the past two years which now has Ether “close to being flipped on its own blockchain.” The market capitalization of Ethereum-based assets is current at $18.7 billion compared to Ethereum's $22 billion.
And this will depend on the growth of stablecoins versus the growth in the value of Ether, observed Ryan Watkins of Messari.
Ethereum is also increasingly used to transfer significant amounts of money and this year it is on track to settle more than $500 billion thanks to stablecoins. During the first quarter of 2020, fiat-backed digital currencies had record growth and most of the stablecoins are based on the Ethereum network.
Ethereum’s dominance in the decentralized finance (DeFi) space is pretty clear and strong, which is emerging as the store of value on the blockchain.
All of this increased usage of the Ethereum network is “a positive for the foreseeable future,” Watkins said.