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As the price of Ethereum’s Ether (ETH) surpassed $ 450, a huge buying wall has emerged on the leading cryptocurrency exchange Bitfinex. Shortly thereafter, ETH hit $ 270, a 19-month high against Bitcoin (BTC).
The price of Ether versus the price of Bitcoin. Source: Skew
Over the past couple of months, ETH has maintained strong upward momentum, supporting growing user activity on Ethereum.
Etherscan data shows that the daily transaction volume on Ethereum went from around 420,000 in January to over 1.2 million transactions per day in August.
Because the price of ETH is rising and the demand for Ethereum is constantly growing
The explosive demand for Uniswap tokens and small decentralized finance (DeFi) has created a steady demand for ETH. On the Ethereum blockchain network, users must use ETH to cover transaction fees, which are also called “gas”.
Gas costs, following increasing daily transactions, have led users to purchase ETH to pay for network charges. Since the beginning of June, when the DeFi market started to see exponential growth, it has fueled the purchase demand for ETH.
According to data from on-chain market analyst Glassnode, gas costs are rising so fast that it’s causing miners’ revenues to rise. Researchers he wrote:
“Ethereum miners have earned over $ 500,000 USD in transaction fees in the past hour. This is a new record for just one hour (excluding anomalous transaction fees earlier this year).”
The current trend is unlikely to change in the near term as second tier scaling solutions and ETH 2.0 are far away.
The hourly transaction fees on Ethereum peaks. Source: Glassnode
However, the DeFi market is constantly expanding, bringing more users to decentralized platforms, such as Uniswap. Whether this would increase ETH buying demand throughout September remains to be seen.
By spotting the demand, whales or wealthy single miners are apparently buying ETH. Bitfinex technical manager Paolo Ardoino She said:
“Someone really wants to buy ETH on Bitfinex 7k bid wall”.
Bitfinex is recognized as one of the few exchanges used by many whales, along with Gemini and Bitstamp. The 7,000 ETH priced at $ 458 equals $ 3.2 million, which is a large single buy order on the exchange.
A buying wall of 7,044k ETH on Bitfinex. Source: Paolo Ardoino
What traders say about the short-term trend
In the short term, traders are generally optimistic about the price of Bitcoin and Ether. Both major cryptocurrencies saw their respective monthly candle close at a multi-year high.
Michael van de Poppe, a full-time trader on the Amsterdam Stock Exchange, said minor consolidation is likely. Subsequently, Van de Poppe suggested that another attempt at $ 12,400 is likely for Bitcoin’s price, with ETH in the lead. He She said:
“Bullish. Reached the $ 12,000 area that I indicated from the low. I would like to see a consolidation above $ 11,600 here. If that happens, we will most likely see a rally to $ 12,400 and new highs. $ ETH is already painting the pattern. Street. “
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