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As the broader cryptocurrency market poses some healthy recovery, the world’s second-largest cryptocurrency Ethereum (ETH) has bounced more than 6% moving past $4,300 levels. On Friday, November 19, the ETH price took a momentary dive under $4,000 correcting more than 15% from its all-time high levels from last week.
Certain on-chain metrics for Ethereum and its fundamentals suggest that the world’s largest cryptocurrency will continue to have the show of strength.
Key On-chain Metrics for Ethereum
As we reported earlier, the non-exchange Ethereum whales have been scooping up massive supply in this price correction. On the other hand, the average gas fee has corrected by a massive 80% just over the last week which is likely to give Ethereum a massive utility push. As on-chain data provider Santiment explains:
Ethereum (ETH) is back above $4,330, & utility should be more reasonable for traders with average fees back at just $11.46. This is about 20% of what $ETH fees were just five days ago right before the dip, where fees were way up at $55.65 per transaction.
On the other hand, the Ethereum (ETH) supply has been on a decline. Post the London hardfork in early August 2021, the ETH supply dynamics have been changing majorly. The Ethereum (ETH) blockchain network is close to reaching a total of 1 million in burned ETH.
So far since the London hardfork, a total of 947,000 ETH have been burned. This is worth a staggering $4 billion. On-chain data provider Glassnode further reports:
The daily burn rate has been steadily increasing in the past months since the London fork. With a burn rate of currently 10-15k #ETH per day, the 1 million burn mark is expected to be passed within the next few days.
The amount of burned $ETH has started to visibly change Ether’s supply trajectory. The circulating ETH supply in the network is now 0.8% lower than it would be without the implementation of EIP-1559.
While Ethereum (ETH) has given a bounce back today, it remains to be seen if this is not a dead cat bounce moment. Simon Dedic from Moonrock Capital says that if ETH sustains $4,000 on the weekly closing, the dip could be bullish for investors.
If $ETH stays above $3900-4000 until end of this week, this dip was actually bullish af for the charts. pic.twitter.com/Y7v2pz5fMN
— Simon Dedic (@scoinaldo) November 19, 2021
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