The year 2022 hasn’t been in favor of the cryptocurrency market. The coins and tokens that were in a bull market in 2021, started a declining phase as they entered 2022. The global cryptocurrency market is thriving to find a sustainable gain since the start of the year.
Along with Bitcoin, Ethereum has been trying hard to move out of the $3,000 range but it’s every attempt to do so has failed while investors are busy booking profits. However, an on-chain metric depicts that things are picking up for Ethereum, pushing the price towards better days.
These On-Chain Metrics Flash A Bull Run For Ethereum
At present, the most bullish on-chain metrics favoring Ethereum’s bull run from a long-term outlook is the diminishing ETH present on exchanges. This number is declining since it climbed to 29.69 million on 30 July 2021.
After the on-chain metric begins its decline, the Ethereum supply has also dropped nearly 50% and currently hovering around 14.91% and in turn, revealing that investors don’t have a bullish approach to Ethereum price performance.
However, they are using other DeFi products such as lending, staking, and borrowing to allow their ETH holdings to earn more money.
This move is one of the most bullish points of view that a cryptocurrency could ever see and this is happening with Ethereum. Furthermore, the upcoming Ethereum update “The Merge” which will transform Ethereum from proof-of-work to proof-of-stake, supports the decline in Ethereum on exchanges.
The next that supports the bullish perspective is the decline in the number of deposits made at centralized institutions. This number hit a high of 455.28k active deposits on 17 June and has been dropping ever since.
Another factor that is acting as a pillar for Ethereum’s bull run is the supply distribution chart that indicates institutions and whales have been busy buying the dip activity. This shows that investors have started the accumulation with the hope of a bull trend.
But if this accumulation declines, then it is mostly because distribution or investors are booking profits and this mainly happens at the peak or at the end of a bull run.
Since the start of March 2022, the wallets that hold 10,000 to 100,000 Ethereum tokens have increased their holdings from 24.85% to 25.62%. This increased percentage in holdings points toward investors, whether institutions or whales are all positive about the price performance of Ethereum in the coming days.
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Source: https://coinpedia.org/ethereum/ethereum-on-chain-metric-hints-bull-run/