Cryptocurrency research firm CryptoQuant said that the recent sharp decline in the number of transactions on the ethereum chain represents the beginning of lower demand for the ethereum network, which also paints a bearish picture for the short-term outlook of ethereum prices.
Generally speaking, “transaction volume” is an indicator that reflects and evaluates the total number of transfers on the Ethereum chain. When this indicator is high, it means traders are active on the network; low values mean there is less activity on-chain.
CryptoQuant analysts published a chart showing the indicator’s 30-day exponential moving average (EMA) trend:
As shown in the above chart, since ETH hit a record high in May 2021, the Ethereum 30-day EMA trading volume has been in an overall decline, and the recent decline has been more pronounced, indicating that the Ethereum blockchain is currently in “low activity.” ” state, there is still a lack of demand for Ethereum in the market.
Additionally, the price of Ether has been trading sideways for some time, and it is unclear when it will break out of this trend.