Real Vision analyst Jamie Coutts thinks Ethereum (ETH), based on a number of market conditions, could be at the beginnings of a major rally.
Coutts said on social media platform X, that there is a growing momentum in the crypto-space which may signal the upcoming surge of the smart contract platform.
Analysts warn that ETH network activity must increase significantly before a trend can be ignited.
While the conditions are in place for a rally, Ethereum is unlikely to be able to rise without an increase in activity. The fees are now at their lowest level in four years.
The positive side of
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The adoption of Layer-2 (L2) has increased by 200 percent in DAUs over the last year.
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The global liquidity has risen.
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Stablecoin Supply increasing and nearing all-time highs
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RWA tokenization has increased 70% in the past year to $11.3 Billion.
The negative side of
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Forward cashflow estimations are likely to adjust due to lower fees and an increasing realization that the long-term L1 value accrual comes at the expense L2 (layer-1).”
Ethereum currently trades for $2761, up over 4% from the previous 24 hours.
Analysts also note that revenue is down in the entire crypto-ecosystem on an annual basis (YoY).
The Crypto Ecosystem update across two key metrics, active addresses (DAUs), and fees. (July-2024). “YoY aggregate performance”: DAUs are up 150%. Charges are down by 20 %.”
The lower fees are a sign of slowed network activity, as there is less competition among users to conduct transactions on the crypto networks.
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