Ethereum’s Q1 Stats Report Highlights Blockchain’s ‘Ultra Sound’ Financial Growth in 2021 – Finance Bitcoin News
Ethereum’s Q1 Stats Report Highlights Blockchain’s ‘Ultra Sound’ Financial Growth in 2021
During the first three months of 2021, the cryptocurrency ethereum has shined as 90-day statistics highlight the digital asset has climbed close to 80% in value. On Monday, former Ark Invest analyst James Wang published a detailed summary highlighting the Ethereum project’s first-quarter financial results. Wang’s comprehensive Ethereum analysis showcases a myriad of data points that accentuate the blockchain’s 2021 achievements.
Analyst Publishes Ethereum Stats for the Blockchain’s Q1 Financial Results
Ethereum has been a force to be reckoned with this year and during the last few weeks, the crypto asset has been siphoning away BTC’s market dominance. There are many reasons ETH has been moving up the ranks and organizations like Fundstrat Global Advisors believe ether can reach $10k per unit. The crypto asset proponent and investor, Spencer Noon, has tweeted his reasons as to why he thinks ETH can make it to the five-digit territory. Market performance is one thing, but the Ethereum blockchain has done far more than gather higher market percentages.
On May 17, 2021, the former Ark Invest analyst, James Wang, published a report called “Ethereum Announces First Quarter 2021 Results” on substack.com. The document highlights the blockchain’s financial results during Q1 2021 and ended on March 31, 2021. Wang’s report shows that Ethereum’s network revenue or the total accumulation of transaction fees jumped 200x to $1.7 billion in Q1. This metric is a stark contrast between the $8 million in network revenue collected in Q1 2020. Transaction volume Wang said, “increased 20x to $713 billion in Q1 2021, compared with $33 billion in Q1 2020.”
Additionally, the blockchain’s daily active addresses have increased 71% to around 607,000 as there were only 364,000 in Q1 2020. As far as staking is concerned, a scheme that was invoked in December 2020, more than 3.6 million ETH worth over $11 billion is being staked today. Wang’s report further notes that Q1 2021 decentralized finance (defi) data has seen total value locked (TVL) increase 64x to $52 billion in comparison to Q1 2020 stats. Since then, the aggregated total of defi has increased by another $20 billion.
A recent report published by Glassnode called “Defi Uncovered: The State of Defi,” also highlights the massive growth defi has seen this year. In eight months, defi has “attracted in excess of $100B into smart contracts,” Glassnode detailed on May 12.
Ethereum’s Decentralized Exchange Volumes, Stablecoins, Wrapped Bitcoin Products
The former Ark Invest analyst’s Ethereum study also discusses decentralized exchange (dex) trading volume and how this metric has increased a great deal. Data from Dune Analytics shows Ethereum-based dex volume has been massive in May. Dex metrics show between 16 dex platforms, there’s been over $6 billion in global trade volume. The last seven days have seen more than $35 billion traded on dex platforms like Uniswap, Sushiswap, 0x Native, Curve, and Balancer. As far as wrapped bitcoin tokens and stablecoins, Ethereum has seen large increases in those areas as well, Wang’s report highlights.
“Stablecoin volume increased 100% to $40 billion in Q1 2021, compared with $20 billion in Q1 2020,” the researcher says. “Wrapped BTC volume increased 95x to 170k BTC in Q1 2021, compared with 1.8k BTC in Q1 2020. Approximately 1% of bitcoin supply is wrapped as ERC-20 tokens and traded on top of Ethereum,” Wang’s report adds.
The Q1 study also covers subjects like the four Canadian ETH exchange-traded funds, Meitu purchasing ETH for its balance sheet, and the network’s “dual pronged approach to scaling network.” Wang also grazes over the EIP1559 improvement set to be deployed in the near future. “2021 is perhaps the most important year in Ethereum’s history,” the report notes. “The two key themes for 2021 are economic security and scalability.”
“People are realizing that Ethereum isn’t just money, it’s ultra-sound money,” Justin Drake, a researcher at the Ethereum Foundation explains in Wang’s analysis. “While other cryptocurrencies may boast of having a supply ceiling, Ethereum will soon have no supply floor.”
What do you think about Ethereum’s Q1 performance and Wang’s comprehensive look at the blockchain’s reported financial results? Let us know what you think about this subject in the comments section below.
Image Credits: Shutterstock, Pixabay, Wiki Commons, James Wang’s report, Glassnode defi report, Twitter,
Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article.
Ethereum’s Q1 ‘Network Revenue’ Increased 200x In One Year To $8.6B
What Happened: Former Ark Invest analyst James Wang believes that Ethereum, the second-largest cryptocurrency by market cap, has a much higher valuation than the current market suggests.
“Ethereum isn’t just a crypto currency. It’s a software platform with users, revenue, and applications. If you cover software like AWS, MSFT, SNOW, or TWLO you should cover Ethereum ($ETH),” (sic) he explained, sharing a break-up of the network’s “First Quarter 2021 Results.”
According to his findings, total transaction volume on the network increased 20x to $713 billion in Q1 of this year, compared to just $33 billion recorded in Q1 2020.
The number of daily active addresses, which can be considered a proxy for the network’s daily active users, increased 71% over one year to 607,000 for Q1.
One of the highlights of the network’s “financial results” was the total transaction fees, which Wang refers to as “network revenue,” which increased 200x to $1.7 billion in Q1 2021, compared with $8 million in Q1 2020.
Why It Matters: It is worth noting that the network revenue, or transaction fees, mentioned here are often a cause for grievance for many in the crypto community.
However, as one DeFi developer on Twitter pointed out, “massive transaction costs on ETH are indeed a flaw, but they are a result of extremely high network usage. This is more bullish than not because it shows us that way more transactions are occurring, even with all the fud about the high gas fees. People are willing to pay them!”
See also: Is Ethereum About To Move Lower?
The entire Ethereum ecosystem also recorded phenomenal growth over a one-year period. Decentralized exchange (DEX) volume increased 76 times to $177 billion in Q1 2021, compared with $2.3 billion last year, and NFT sales increased 560 times to $396 million in Q1 2021, compared with $0.7 million in Q1 2020.
Price Action: The cryptocurrency recorded a high of $4,362 last week but has since traded lower. At press time, Ethereum was trading at $3,267, down 8.43% in the past 24-hours, according to CoinMarketCap.
Ethereum Dives Amid Profit Taking After The Recent Rally
Ethereum Video 17.05.21.
Traders Stay Focused On Musk’s Tweets
Ethereum found itself under strong pressure at the beginning of this week. Cryptocurrencies moved lower after Elon Musk did not clearly state whether Tesla sold Bitcoin in a twitter discussion over the weekend. Musk has recently clarified his position and tweeted: “To clarify speculation, Tesla has not sold any Bitcoin”.
The tweet helped Ethereum and Bitcoin recoup some losses, but both leading cryptocurrencies remain under pressure. The sell-off in Ethereum is especially strong since the latest upside move was very fast, and traders rushed to get out of their positions in order to take some profits off the table.
Bitcoin is moving lower in an orderly fashion, and this move is worrisome for the whole crypto market as Bitcoin has recently made an attempt to settle below February lows near the $43,000 level. If Bitcoin settles below this level, it will gain additional downside momentum which will be bearish for other cryptocurrencies, including Ethereum.
Technical Analysis
Ethereum has recently managed to get out of the previous upside channel and gained downside momentum. However, the cryptocurrency received support at $3125 and got back above the resistance at the 20 EMA at $3290.
The next resistance level for Ethereum is located at $3600. If Ethereum gets above this level, it will head towards the resistance at $3775. RSI declined into the moderate territory, and there is plenty of room to gain additional upside momentum. If Ethereum settles above $3775, it will head towards the resistance at $4150.
On the support side, the nearest support level for Ethereum is located at the 20 EMA at $3290. If Ethereum declines below this level, it will head towards the recent lows at $3125. A move below the support at $3125 will open the way to the test of the support at $2800.
For a look at all of today’s economic events, check out our economic calendar.
This article was originally posted on FX Empire
More From FXEMPIRE: