A data analyst named Murphy has been studying Ethereum’s on-chain data to answer some questions. He believes that ETH’s current underperformance might be due to the Ethereum Foundation selling coins frequently. He also analyzed the five main points that people are concerned about. 1. Why is ETH performing poorly this time?
2. Is there still hope for ETH? 3. Under what circumstances can ETH make up for the increase? Murphy has provided an analysis of the ETH chain’s data to give some reference points. He believes that ETH’s performance has been “too good” recently and that it needs to be analyzed in detail. Murphy has looked at two measures to determine if ETH is being paid attention to by funds, the “Traffic proportion of exchange ETH” and the “Comprehensive activity on the chain.” He believes that as the “flow” gets higher, ETH is being paid attention to by more funds.
He also uses #BTC as a reference to show how capital preferences change. Murphy has looked at the traffic performance of ETH in the last cycle and compared it to this cycle. He found that the traffic of ETH in this cycle is only about 15% of BTC’s while in the last cycle it was around 50% of BTC. He also found that after BTC broke through the historical high in this cycle, funds did not flow to ETH like in the previous cycle.
Murphy then looked at the on-chain activity data of ETH, which includes the number of active addresses, the number of transfers, and the transaction amount in US dollars. He found that the number of active addresses on ETH has been declining since March and that the amount of transfers on the ETH chain has only been US$6.7 billion, which is not even half of the 21-year high.
Murphy concludes that ETH’s underperformance is due to the lack of interest from funds. He believes that ETH can make up for the increase when the following conditions are met:
1. The ETH’s exchange traffic versus BTC’s is 50% or more (currently it is 35%). 2. ETH’s price has gone up after reaching 50%, but it will definitely not be the highest.
3. The number of active addresses on the chain reflects the prosperity of the ETH ecosystem. 4. The number of transfers and the transaction amount should be amplified simultaneously. In conclusion, Murphy believes that ETH’s underperformance is due to a lack of interest from funds, but it can make up for the increase when the appropriate conditions are met.
