When the price of Ether by Ethereum (ETH) exceeded USD 450, a huge buying wall emerged at the large Bitfinex cryptoexchange. Soon after, ETH reached USD 270, a 19-month high against Bitcoin (BTC).
The price of Ether against the price of Bitcoin
During the last two months, ETH has maintained a strong upward momentum that has driven the increase in user activity at Ethereum.
Etherscan data shows that the daily transaction volume at Ethereum increased from around 420,000 in January to over 1.2 million daily transactions in August.
Why the price of ETH is rising and the demand for Ethereum is constantly growing
The explosive demand for Uniswap and small decentralized finance tokens (DeFi) has created a constant demand for ETH. In the Ethereum block chain network, users have to use Bitcoin Future to cover transaction costs, which is also called „gas“.
Gas costs, as a result of increasing daily transactions, led users to purchase ETH to pay for network expenses. Since the beginning of June, when the DeFi market started to see an exponential growth, it boosted the demand to buy ETH.
According to data from the chain market analysis company Glassnode, gas costs are increasing so rapidly that miners‘ incomes are skyrocketing. The researchers wrote:
„ETH miners earned more than USD 500,000 in transaction fees in the last hour. That’s a new record for a single hour (excluding abnormal transaction fees earlier this year).
It is unlikely that the current trend will change in the short term, as second layer scaling solutions and ETH 2.0 are far away.
Analysts predict that Yearn Finance’s ETH vault could cause a further rise for Ether
Hourly transaction fees on Ethereum spikes
However, the DeFi market is continuously expanding, leading more users to decentralized platforms such as Uniswap. It remains to be seen if this will add more demand to the purchase of ETH throughout September.
When demand is seen, whales or rich miners are buying ETH. Bitfinex Technical Director Paolo Ardoino said:
„Someone really wants to buy ETH on the Bitfinex 7k bidding wall.“
Bitfinex is recognized as one of the few exchanges used by many whales, along with Gemini and Bitstamp. The 7,000 ETH at a price of $458 is equivalent to $3.2 million, which is a large single purchase order on an exchange.
The price of Ethereum broke through the $400 resistance in the bullish option data