Ethereum Staking and Burning Metrics Solid But Bearish Price Prediction Still Looms

Several metrics for the Ethereum network remain bullish but that hasn’t been reflected in the price which could fall further in the short term.

The Ethereum network is still showing solid metrics in terms of staking and activity, however, prices continue to erode as the crypto winter lengthens.

With more than 14 million ETH staked and 439,425 active validators, the Ethereum network is looking pretty healthy at the moment. At current prices, that works out as a little over $18 billion representing 11.6% of the entire supply of ETH.

Stakers are being rewarded with a current annual interest rate of roughly 4% which beats anything offered by most high street banks. The ETH locked on the Beacon Chain is still immobile and will not be accessible for a few months when it is likely to be released in stages.

Solid Ethereum network stats

Since the Merge on Sept. 15, the total supply has increased by just 0.18%, adding just 10,500 ETH to the circulation. Under periods of heavy demand and network activity, the issuance will become negative as more ETH is being burnt by the EIP-1559 process.

The Ultrasound.Money platform predicts that the supply of Ethereum will start to decrease from now on, dropping by around 3.5% to 116 million over the next two years.

There is currently around 550 ETH being burnt per day worth approximately $710,000 at current prices. NFT platform OpenSea has been the biggest gas guzzler followed by Uniswap. Gas prices are currently very low at $0.07 per transaction on average.

On Oct. 3, Messari reported that average Ethereum NFT daily trading volumes dropped dramatically during Q3. However, it observed that the average number of daily traders witnessed a much smaller decline, adding that “this indicates a sticky base of committed users at around 40,000 per day.”

There are currently 1.2 million daily transactions on the Ethereum network maintaining steady activity levels over the past year or two which suggests that demand is not waning along with prices.  

Prices could fall further

Unfortunately for investors, none of these bullish statistics have been reflected in recent price action. ETH is currently trading at $1,289 after falling 1.7% on the day. The asset is now down 18% over the past month and 74% since its November all-time high.

Some analysts are predicting further losses and a potential fall to the low $1,000 area since it has been unable to overcome resistance at higher levels.