The network growth of Ethereum (ETH) and Chainlink (LINK) has continued to hit new milestones. This makes it likely that both cryptocurrencies will rise in price in the coming sessions.

According to statistics from on-chain data aggregator Santiment, an explosion in network activity has followed the price rallies of both ETH and LINK.

The simultaneous network growth, represented by the number of daily new addresses created, supports this bullish narrative. As of Feb. 8, 2021, the number of new daily wallets on the Ethereum and Chainlink networks stood above 163,000 and 6,700, respectively. 

Network Activities and Prices Rise Together

According to the chart, these high transaction levels are not new for ETH. The smart contract platform recorded a higher count of 177,000 on Dec. 13, 2020. At the time, this increase was not adequately reflected in price movements. BIC previously reported that an explosion in Decentralized Finance (DeFi) was responsible for this spike. 

In addition, the price of ETH has been steadily rising. The same data shows that the smart contract token began to break through significant price hurdles after Dec. 15, 2020. Since then, the second-largest cryptocurrency by market cap has recorded an over 170% increase. Ethereum achieved this feat in less than 60 days.

Ethereum also recently broke a new all-time high. Data from market aggregator CoinGecko shows that ether currently falls behind bitcoin (BTC) in weekly gains. Both digital assets recorded a 19% and 31% increase within the last seven days, respectively. ETH has broken its former resistance level and now sits at $1,800.

Meanwhile, the same can be said for LINK as these levels are not far from former records. The number of new wallet addresses on the oracle-centric network was about 10,000 in 2020. This development was seen on Aug. 13, 2020.

Furthermore, the on-chain data shows that a meteoric rise in the price accompanied this increased network activity. Chainlink sliced through strong resistance levels, rising from $6 to $20 in mid-2020. Market volatility and network activity have remained relatively calm since then.

The inflow from institutional investors has contributed immensely to these price swings. At the beginning of Feb., Ethereum topped weekly inflows for investment behemoth Grayscale.

A yearly review from Coinbase may add credence to this view. Data from Coinbase’s annual report indicates that institutions are waiting at the gates as investors seek an inflationary hedge.

This appears to be the case for Chainlink as well. The wealth gap between whales and regular holders continues to grow. Only a minority of holders control more than 80% of the LINK in circulation. Individuals and firms of high net worth are scooping up the tokens.

Disclaimer


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