Activities on the Ethereum chain have surged, and bullish sentiment has soared. Is it profitable to exit or long-term hold?


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Santiment’s latest findings published in Cointelegraph Consulting’s bi-weekly newsletter indicate that the discussion on Ethereum has shifted from being highly bearish to mainly bullish. Historically, this is not good news for the price of Ethereum tokens.

The recent increase has brought the number of daily addresses in Ethereum to 420,610, which is the highest point in three weeks and an increase of 25.2% compared to the previous day.

Another notable trend is the 365-day “dormant circulation” of Ethereum, which tracks the re-movement of all tokens that have not changed addresses in more than a year. Since bottoming on October 7, this number has remained relatively low, with an average daily record of only 13,438 ETH, which shows that despite the recent price rebound, long-term holders still insist on holding.

Ethereum’s network profit/loss calculates the average profit and loss of all tokens that change addresses every day. This is a good way to see which holders panic selling due to losses. When the entire market crashed on March 13, 2020, the Ethereum network achieved a cumulative loss of US$2.9322 million, which was the lowest loss in 3 months. In a similar way, the Ethereum network realized a cumulative loss of US$998,998 on October 7th, and soon afterwards Ethereum rebounded to over US$350.

In the past two months, many of Ethereum’s bottoms have exhibited the same pattern of behavior, indicating a wave of panic selling and redistributing Ethereum to strong players in the short term, making the rebound more durable.

Ethereum’s 30-day MVRV ratio tracks the average profit (or loss) of all addresses that have received ETH in the past 30 days, which shows that short-term ETH holders are currently up 8% on average from their initial investment.

At present, the 30-day MVRV ratio of Ethereum is still somewhat distant from the historically considered “dangerous zone”, which is the price level that short-term holders wanted to sell in the past.