Newcomers Flock In as Ethereum (ETH) Supply Hits Record Low

Ethereum's circulating supply across 1-year, 3-year, and 5-year periods has now hit its lowest recorded levels.

Newcomers Flock In as Ethereum (ETH) Supply Hits Record Low. Image: U.Today

According to data from The Block, the rate of active Ethereum, meaning tokens moved between wallets, is at an all-time low over the past year. Reserve ratios over 30 and 90-day reference frames have also nearly bottomed out, more than halving from their peaks.

Percentage of Ethereum's circulating supply active. Source: The Block

Comparatively, Ethereum's 9% decrease in supply over the past 12 months contrasts with Bitcoin, which after reaching a record low in supply has begun to reverse with a 1% increase over the year. Bitcoin's recovery momentum has significantly closed the supply gap between these two largest cryptocurrencies in the market.

Active supply ratio comparison between Bitcoin and Ethereum over the past year. Source: The Block

Last month, Ethereum welcomed an additional 3.66 million new addresses, marking the highest influx since the collapse of FTX exchange. Meanwhile, long-term holders of ETH appear to be holding onto their assets more steadfastly than ever, primarily focusing on layer-2 solutions like Base.

New wallets created on Ethereum over the monthly timeframe. Source: The Block

Ethereum successfully upgraded to Dencun last month, implementing "blobs" to optimize transaction fees across layer-2 networks.

ETH is currently trading around $3,416, having decreased nearly 6% over the week and 14% over the month. Nevertheless, the largest smart contract network's coin continues to achieve a significant performance of up to 84% over the year.

1-day chart of the ETH/USDT pair on Binance at 10:15 AM on 08/04/2024