Ethereum has experienced a substantial surge in network activity. As a result, new records are being set for daily addresses and smart contract calls. Nevertheless, ETH crypto continues to struggle. This made it a case in which the increasing use of the network is not reflected in the price.
Analysts warn that the Ethereum price may have more downside risk. Some are predicting that the price may drop to $1,500 by 2026, provided market conditions don’t improve.
The Ethereum usage has touched new highs, with daily active addresses and smart contract activity reaching all-time highs.
CryptoQuant has reported to have seen internal contract calls hit all-time highs, mainly on DeFi platforms, stablecoins, and Layer-2 networks. These metrics are indicative of growing use cases of Ethereum for different applications.
Number of Active Addresses on Ethereum Network | Source: CryptoQuant
Despite all these amazing numbers, the Ethereum price has not seen the same upward trend. ETH crypto is down more than 50% from the last cycle high.
This also shows the poor correlation between increased network activity and asset price. CryptoQuant calls this an “adoption paradox,” where network growth is not accompanied by any significant price movement.
Ethereum price has been testing key resistance areas, with $2,100 being the primary resistance zone. Despite a 4% price increase in the last 24 hours, Ethereum is still struggling to break these resistance levels.
A failure to reclaim key resistance zones could push the asset into extended consolidation. It may also trigger further price declines if momentum weakens.
Analysts like Julio Moreno of CryptoQuant warn that Ethereum could drop to $1,500 by the end of 2026. This projection assumes demand for the cryptocurrency stays at current market levels without significant growth.
The overall bear market and the failure of Ethereum to break through resistance levels contribute to the current market sentiment.
ETH will need a strong catalyst or a shift in market conditions to break through key resistance levels. Only then can it trigger a sustained bullish rally. Without such a change, Ethereum analysts expect Ethereum to continue to be under pressure.
Ethereum’s exchange flows offer further insight into the bearish sentiment around the cryptocurrency. Data from CryptoQuant showed that Ethereum’s inflows are high in comparison to Bitcoin’s.
It suggests that there is more selling pressure on ETH. This pattern suggests that a large number of Ethereum holders are selling off their holdings instead of holding on long term. That’s an additional downside to the price.
BTC and ETH Total Exchange Volume | Source: CryptoQuant Data
Additionally, Ethereum’s realized capitalization has gone negative, indicating that there is an outflow of capital into the network.
This outflow also adds to the bearish perspective and decreases the investment in Ethereum. That is a drop in demand. According to analysts, Ethereum must be able to receive more capital inflows and fewer exchange inflows to reverse the current trend.
However, if Ethereum manages to break its current resistance zone, a rally could be on the horizon. Ted’s technical analysis implied Ethereum price could be oriented for a major move if it can reclaim the $2,250 level.
Once ETH breaches this level, it could spark a rally toward the $2,400 zone. From there, it may continue climbing toward higher resistance levels.
ETHUSDT Daily Chart | Source: Ted, X
The market’s reaction to Ethereum’s price movements and broader conditions will play a decisive role. That response will determine whether ETH can successfully breach its resistance levels.
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