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Vitalik Buterin And Ethereum Foundation Selling ETH – Will Prices Fall?

Ethereum supporters are confident that prices will break the $2,000 level. However, recent moves by its founder, Vitalik Buterin, and the Ethereum Foundation, the team managing the smart contracting platform, raises concerns, especially from coin holders and traders, on whether the coin has what it needs to break above key resistance levels.

ETH Transfer Raises Concerns Among Investors

On May 5, a tracker, LookOnChain, noticed that Vitalik.eth, the domain associated with Ethereum co-founder Vitalik Buterin, transferred 200 ETH, which is worth about $400,000 at current valuation, to Kraken, a cryptocurrency exchange.

Shortly after that, the Ethereum Foundation also made a much larger transfer, moving 15,000 ETH, worth about $30 million, to the same platform.

 

This has raised concerns among holders, who are worried that the dumping of such a large amount of ETH could further pressure prices.

It’s worth noting that ETH is currently down 13% from its April highs, and sliding.

Ethereum Price On May 6| Source: ETHUSDT On Binance, TradingView

Coin holders, including those of ETH, typically send tokens from time to time. Even so, any transfer to a centralized exchange is interpreted as bearish. Vitalik Buterin might need funds to cover operating costs or even invest in projects. At this time, it is not known why he sells.

In the past, Buterin has sold ETH in batches without causing a significant price drop.

Despite this development, some analysts, including Santiment, believe that ETH may be decoupling from Bitcoin, and that it might soon recover, breaking above $2,000.

According to data from Santiment, a leading on-chain data company, there has been a significant increase in the amount of Ethereum being moved to crypto exchanges over the past few months.

 

Ethereum Sees Increased Adoption

Despite these concerns, there are also positive signs, based on on-chain activity.

A record amount of ETH was burned at the end of this week, thanks to the meme coin craze, and specifically, PEPE. The majority of meme coins run on Ethereum and are being actively moved with higher gas fees, providing a great opportunity to burn ETH and decrease the circulating supply.

 

 

In addition, Ethereum is seeing increased adoption from major companies and institutions, which is driving up demand for the cryptocurrency.

Last week, the European Investment Bank (EIB) announced that it had issued its first-ever digital bond on the Ethereum blockchain, marking a significant milestone for the cryptocurrency.

The increased adoption and burning of ETH due to the meme coin mania could sustain prices above key support levels in the days ahead. Still, it remains to be seen how prices will react in the days ahead.

The sharp drop on May 6, reversing gains of May 5, could anchor the next leg down, forcing even more liquidations towards the $1,500 support line.

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Ethereum Gas Fees Falls To Record Low, Price Consolidates Around $1,000

After reaching a level last seen in November 2020, the average Ethereum gas fee is now below $1.

Ethereum Gas Fees Falls

The Ethereum network experienced transaction fees as low as 69 cents on Saturday, which has not happened in the previous 19 months. The following day, gas prices reached $1.57 or 0.0015 ETH, which is equivalent to December 2020’s numbers. Transaction costs on the network today ranged from 20 cents to merely 20 cents, with 20 cents being the highest.

Gas prices in the Ethereum ecosystem ranged from $0.01 to $0.10 from July 2016 to May 2017. Users are now assessed a substantial cost; in May 2021, average transaction fees reached $69 per transaction. The highest gas price ever observed was $196.683 in May 2022.

Notably, the Ethereum blockchain has struggled to become widely used, much to the chagrin of users, due to the high cost of gas or network fees, payments necessary to complete a transaction on a blockchain. NFT holders are seen profiting from the decline as the numbers dwindle.

Source: Bitinfo charts

DappRadar reports that 50,466 people have traded their assets in OpenSea, up 10.14 percent from the previous day. At the time of writing, the largest NFT market’s trading volume increased by 34.18 percent to $15.92 million.

All of the top 20 collections, led by Ethereum Name Service, DopeApeClub, God Hates NFTees, Bored Ape Yacht Club (BAYC), and Mutant Ape Yacht Club (MAYC), were transacted within Ethereum, according to data from DappRadar.

Related reading | TA: Ethereum Close Below $1K Could Spark Larger Degree Downtrend

Price Slumps Further

The analysis of the price of ethereum is bearish due to consolidation near $1,050 and rejection of further recovery. As a result, ETH/USD is prepared to decline even further and surpass the $1,000 local support. After that is finished, the prior swing low at $900 should be challenged the following week.

The decline approached the $1040–$1000 area that serves as a close support and was accompanied by a sharp increase in demand pressure. The numerous smaller price rejection candles at this point represent attempts by sellers to break through this support that were unsuccessful.

Therefore, the renewed positive momentum could encourage buyers to again attack the overhead barrier of $1260, providing ETH holders with a chance for a recovery.

ETH/USD consolidates above $1k. Source: TradingView

At the start of the week, a significant new swing bottom was established in the price movement of ethereum. After falling by more than 21%, the price of ETH/USD hit a new low at $1,000.

From then, a swift upward reaction continued to the $1,115 level, where Friday’s rejection of further recovery was observed. Following sideways consolidation, lower local highs and lows were set.

Since then, the $1,050 level has functioned as the main trading range, with this morning’s denial of further gains. As a result, ETH/USD is prepared to drop even more and try to surpass the current low of $1,000.

If the traders continue to be persuaded by the sellers to break through the bottom support, the next decline could drive the price of ETH down by 12.56% to $880.

Related reading | Ethereum (ETH) Bends Toward $1,000 As Doubt Fills Crypto Markets

Featured image UnSplash, chart from TradingView.com

 

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Ethereum Fees Touch Monthly Lows As Transaction Volumes Plummet

Ethereum fees had touched new highs thanks to the popularity of the decentralized finance (DeFi) space. As network activity had grown, so had the transaction volumes. The effects continue to linger even into the bear market, although fluctuations between low and high are now more common in the space. Presently, transaction volumes have fallen sharply and ETH fees have now plummeted to monthly lows.

Ethereum Transactions At $0.5

Ethereum transaction fees have declined to one of their lowest points this year. Gas costs which have been fluctuating between high and low seem to have found their resting place at lower prices. In the early hours of Monday, the gas costs for the Ethereum network had declined to their lowest point for June. It sat at only 19.8 Gwei per transaction at the time of this writing, which converted to about $0.5 per transaction on the network. 

Related Reading | Bitcoin May Not Reclaim All-Time High For Another Two Years, Binance CEO

This translates to a more than 80% drawdown from the peak of the gas costs last week at 151.3 Gwei per transaction. This coincides with a decline in transaction volume on the network, as shown on Messari.

The data aggregation website shows that Ethereum’s transaction volume is down more than 80% from its monthly high. On the 13 of June, transaction volumes on the network had sat at more than $10 billion in real volume. Today, the real volume was sitting at $570 million, the lowest it has been for the month.

ETH price declines to $1,179 | Source: ETHUSD on TradingView.com

Supply has also taken a hit in the month of June. By the end of last month, there was more than 8.6% of all total ETH supply in DeFi. However, as of the time of this writing, there is less than 8.3% of the circulating supply in DeFi. This also translates to a dollar value of under $10 billion when three weeks ago, the value was at $30 billion.

ETH Profitability Tanks

With the recovery in the price of Ethereum has come some good tidings for investors. But, there is still a gap in the profitability levels from last year compared to this year. Going into the last month of the year in 2021, more than 80% of ETH investors had been swimming in profit. Given that the digital asset had hit a new all-time high in November, this was expected.

However, there is a significant drawdown from this point. Data from IntoTheBlock shows that while the majority of ETH investors remain in profit, it is only by a small margin. 52% of wallets are currently in the green while 47% are in loss. This puts only 2% of all investors in the neutral territory, which remains shaky.

Related Reading | Bitcoin Perpetual Open Interest Suggests Short Squeeze Led To Crash

When it comes to the growth of the network, there is more negative sentiment among investors. The major reason for this is all of the competitors that are moving into the DeFi and NFT space. Solana especially has been giving Ethereum a run for its money in the NFT game, triggering an exodus towards the network which offers faster transactions and lower fees.

Nevertheless, Ethereum remains the second-largest cryptocurrency by market cap. Currently trading at $1,200 at the time of this writing, the cryptocurrency boasts a market cap of $149 billion.

Featured image from CryptoSlate, chart from TradingView.com

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Bored Ape’s Land Sale Broke Ethereum. Extreme Success Or Roaring Failure?

On Saturday, April 30th, Bored Ape’s creators Yuga Labs broke Ethereum. Their new metaverse-inspired project, Otherside sold plots of virtual land to a roaring crowd of people yelling “Shut up and take my money!” In this case, the currency in question was the recently created ApeCoin. However, since Ethereum hosts ApeCoin and the land NFTs, the roaring crowd needed ETH to pay for the operations’ gas fees. 

If you’re familiar with Ethereum, you already know what happened. According to IntoTheBlock’s Lucas Outumuro, “The Bored Ape’s Otherside land sale led to more fees being processed by Ethereum in three hours than in the previous two weeks.” Of course, all hell broke loose. The gas prices across the network went through the roof, many transactions failed causing people to lose their gas fees, and others just couldn’t afford to mint the NFT lands they were entitled to.

At the end of the day, the Otherside virtual plots NFTs, known as Otherdeeds, sold out. The Ethereum network pocketed around $125M just in gas fees. It didn’t survive the madness unscathed, though. Several Ethereum-based projects reported failed and/or slowed down operations and Etherscan, Ethereum’s block explorer, completely crashed. “We’re sorry for turning off the lights on Ethereum for a while,” Bored Ape’s creators Yuga Labs stated.

The Origins Of Otherside

Back in March, Yuga Labs raised an Andreessen Horowitz-led funding round of $450M to build Otherside. Apparently, it’s a Metaverse project in the vein of Decentraland and The Sandbox, but with a Play-To-Earn element built into it from the beginning. That same month, they created the now-defunct http://somethingisbrewing.xyz/ to ask people to KYC themselves and link their personal info to their Ethereum addresses.

Those registered addresses had the right to mint two plots of land in the Otherside playground. Bored Ape’s holders received two free plots each. There are a total of 55K Otherdeeds. To mint each one cost 305 ApeCoin, plus the Ethereum network’s gas fees. Even though it was expensive, considering Yuga Lab’s successful track record, it seemed like a steal.

Until the gas prices rose to unpayable levels, that is.

ETH price chart on FTX | Source: ETH/USD on TradingView.com
Bored Ape’s Creators Yuga Labs Speak

After selling everything, breaking everything, and leaving humble collectors land-less, the Bored Ape’s creators responded to the controversy with this brief Twitter thread.

We know that the Otherdeed mint was unprecedented in its size as a high-demand NFT collection, and that would bring with it unique challenges.

— Yuga Labs (@yugalabs) May 1, 2022

Among other things, Yuga Labs stated:

  • Even though they took the mentioned KYC measures, too many people wanted in. “This has been the largest NFT mint in history by several multiples, and yet the gas used during the mint shows that demand far exceeded anyone’s wildest expectations.”
  • Soon, ApeCoin will cease to be an Ethereum token and will become a full-fledged cryptocurrency. “It seems abundantly clear that ApeCoin will need to migrate to its own chain in order to properly scale. ”

We're sorry for turning off the lights on Ethereum for a while. It seems abundantly clear that ApeCoin will need to migrate to its own chain in order to properly scale. We'd like to encourage the DAO to start thinking in this direction.

— Yuga Labs (@yugalabs) May 1, 2022

  • They will refund the gas fees of the operations that didn’t go through. “For those of you affected, we appreciate your willingness to build alongside us – know that we’ve got your back and will be refunding your gas.”
  • In a posterior tweet, Yuga Labs announced that the gas-refunding process has already started. “Note that you do not need to do anything – we will transfer it all back to your wallet and announce when it is completed. Don’t click any links.”

We are still working on refunding all Otherdeed minters with failed transactions their gas. Note that you do not need to do anything – we will transfer it all back to your wallet and announce when it is completed. Don't click any links.

— Yuga Labs (@yugalabs) May 2, 2022

Even though it sounds like the Bored Ape’s creators are doing the right thing, its worth noting that the people receiving said refunds didn’t get to buy an Otherdeed NFT and the collection sold out. They can still get them in the secondary market at a premium, but the community is not pleased.

Bored Ape’s Users Speak

What follows is a narrow selection of opinions about the launch. Most of these people are Bored Ape’s rich and are heavily invested in the Yuga Labs ecosystem, but they’re worried. Let’s summarize what they said.

  • According to Ap3father, “The drop went unbelievably poorly. That’s the truth of it all.” Plus, “this drop did nothing to help further the distribution of the already popular Yuga community … the same 27.5k people bought ..” However, he reflects, “Yuga Labs made me a millionaire. I am beyond spoiled, humbled, and blessed to be in this situation because of them.”

The drop went unbelievably poorly. That's the truth of it all. The initial thesis was that not enough KYC wallets exist for it to sell out in wave-1 .. not only was that incorrect … It sold out with 2+E in gas the entire way … a nightmare scenario …

— ap3father.eth (@ap3father) May 1, 2022

His conclusion is that “The community responded atrociously to this mint.” And his advice is to sell, “You may have millions in NFTs and that’s outstanding, but grab onto reality. When you die one day … they don’t bury you in the metaverse my friend. ” He has extra Bored Apes, though, so he’s not going anywhere. “I am excited to both sell some apes & continue my journey into the otherside.”

  • For his part, Irish expressed suspicion. “How does the biggest innovators in the space not forsee a gas war? You literally have every address, identification of every KYC’d.  Offer each KYCd 2 lands?” And tried to get Yuga Labs to honor their promise to sell him an Otherdeed, “We hear how you “make good” I’m thrilled you are paying failed transactions! Acknowledge your mint mistake.”

I spent 3 hours constantly refreshing and trying like many here. If you really want to spread to wallets let those KYC'd mint. We should've been given 2 weeks. And put on allowed mint list on contract. Similarly like Gary Vee did, Instead you chose PR nightmare.

— Irish (@Irishmikeys) May 2, 2022

  • On the other hand, 3433 defended Yuga Labs. “Yuga let us mint BAYC for 0.08, they gave us Dogs to claim currently worth 9 ETH, they gave us free serums worth 57 ETH to drink or hold/sell which made Mutants, worth 30 ETH, they gave us 100-200k USD worth of $APE coin.”

Sure, maybe the mint could of gone better, we could of had a Cue/Raffle system, but at the end of the day every successful mint on ETH is a fucking shitshow, we all know this.

— 3433.eth 🍌 ☕ (@boredape3433) May 1, 2022

Vitalik Buterin Speaks

  • Last but not least, Ethereum’s creator Vitalik Buterin defended the Yuga Labs smart contract that governed the whole operation. “Regardless of contract details, tx fee goes up until list price + tx fee = market price. If gas usage per purchase decreased 2x, the equilibrium gas price would have just been >12000 gwei instead of 6000.”

Don't think optimizing the contract would help. Regardless of contract details, tx fee goes up until list price + tx fee = market price. If gas usage per purchase decreased 2x, the equilibrium gas price would have just been >12000 gwei instead of 6000.

— vitalik.eth (@VitalikButerin) May 1, 2022

Nevertheless, the Bored Ape’s creators seem pretty determined to create their own blockchain. Some people even suggest that they orchestrated this whole situation to justify and market it. 

Featured Image: Bored Ape’s metaverse Otherside logo from the site | Charts by TradingView

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Ethereum Transaction Fees Near Six-Month Low Amid Declining Prices

Ethereum gas prices have been declining for a while now. It had risen to its all-time high back in 2021 when the bull market was in full bloom. It then continued to maintain on the high spike, spiking at various intervals to high points. At its highest, average ETH gas fees were as high as $69. However, with the recent downtrend and the market losing momentum, the gas fees have crumbled and the recent decline has seen its near six-month lows.

Ethereum Fees Are Down

Ethereum gas fees for the last three months showed a consistent downtrend that saw average gas fees decline as low as $5.98 in early March. This had been the lowest that gas fees had been in seven months at this point. However, a spike in gas fees in early April would quickly put an end to this sending gas fees as high as $43 once more. This would prove to be only temporary given that the sharp downtrend that followed has sent ETH gas fees to plummet towards six-month lows.

Related Reading | DeFi Stablecoin Platform Beanstalk Suffers ~$80M Hack

As of Monday, Ethereum gas fees had declined as low as $8.78 on average. It represented a 76$% drop from its April high to put it in levels recorded in early March. The drop in ETH fees has also translated to a drop in the fees of Layer 2 rollups which boast significantly lesser fees than it costs to transact on the main network. 

The lowest recorded fee rate had dropped to as low as $0.03 per transaction on Sunday recorded on Metis Network. Others like Loopring and Zksync had seen transaction fees slide to as low as $0.05.

Bitcoin fees had also fallen and the average transaction fee as of early Monday sat at $1.04.

ETH On The Charts

The current downtrend seems to be prominent in not just the transaction fees but the price of the digital asset. Ethereum price had crashed below $3,000 in the early hours of Monday, and while small recoveries were made, various dips saw the digital asset touch the $2,800 price range before the opening of the markets on Monday.

Related Reading | TA: Ethereum Slides Below 3K, Why Bears Could Aim $2.5K

With selloffs rocking the market, indicators had turned inherently bullish for the digital asset, skewing completely in favor of the sellers. After breaking the $3,000 mark, the next major support level now lies at $2,900 although bears continue their efforts to drag it down lower. 

ETH has now fallen below the 50-day moving average. This puts the short-term forecasts of the cryptocurrency right in the negative for the majority of traders, and the long-term outlook is not looking good either. The digital asset is trading at $2,909 at the time of this writing.

Featured image from Shrimpy Academy, chart from TradingView.com

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Ethereum Fee Averages Remain Above $30 Despite 35% Drop. Price Pump Incoming?

Ethereum fees remain high as the network continues to see some of the highest traffic in the industry. Daily transaction volumes put Ethereum in the billions per day and all of these transactions carry a higher than average fee. This fee structure which has caused concern among users seems to not be going anywhere, but there looks to be a light at the end of the tunnel.

Recently, the average transaction fee for Ethereum transactions has dropped significantly. In the past week, the average transaction fee for ETH transactions topped 35% in total, but it still remains on the high side compared to other blockchains.

Ethereum Fees Are Down

Data from BitInfoCharts shows that Ethereum fees are down over the past week. It correlates to a 35% drop in fee rates, however, the blockchain remains one of the highest in terms of fees. Leading up to last week, transaction fees were averaging around $50 per transaction. With the recent decrease, this number has now dropped to $35 on average per transaction.

Related Reading | Solo Ethereum Miner Hits The Jackpot With 170 ETH For Mining A Block

This is expected given the amount of activity the blockchain houses but it is still on the high side. According to this report, Ethereum users are paying about $40 million in fees daily, whereas rival Cardano only sees about $87K spend in fees on an average despite recording almost identical transaction volumes as ethereum.

ETH trading at $3,257 | Source: ETHUSD on TradingView.com

The median gas fee for the network sits at about 0.0047 ETH or $14.78 for each transfer, considerably higher compared to other leading blockchains in the space. ETH miners are also getting some of the highest miner rewards, ahead of bitcoin miners. This fee structure is a pain point that is expected to be addressed in the move to ETH 2.0 in the coming year.

ETH Getting Ready For A Pump?

The decrease in transaction prices could spell good news for the digital asset. With transaction fees tumbling, it would allow for faster transactions. Also, with transaction fees down, it most likely means that more investors are opting to hold on to their digital assets rather than deciding to move them around, which could point to consolidation and accumulation on the part of these investors.

Related Reading | American Rapper Lil Baby On Holding Bitcoin And Ethereum Over Fiat

With less ETH moving around on the network and onto exchanges for sale, then supply on exchanges are down during this time. Usually, notable recovery periods are preceded by periods of stretched out accumulation, where investors choose to pile on to their current holdings.

This, in addition to the fact that the price of the digital asset has been dropping for a while and is primed for a correction, ethereum may be getting ready for a bounce-back towards $3,500.

Chart from TradingView.com

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Is Norton 360 Mining Ethereum In Your Computer? If It Is, They’ll Take a 15% Cut

The most popular antivirus, Norton 360, made a miner out of everyone. Even though this has been going on for a while, the Internet recently found out about it. And traditional Norton customers are livid. One of the most controversial parts of the story is the 15% cut that the company takes. This is a commercial program that you have to pay for, so it’s only logical that people are not ok with that.

Related Reading | Research: Crypto Mining Malware Still Abundant Despite Market Decline

Of course, Norton’s Ethereum mining program is nothing new. Seven months ago, when they were testing it out, our sister site Bitcoinist reported on it and said:

“A select number of Norton 360 customers, who joined the early adopter program, received their invites to mine Ethereum today. The program is expected to expand to include all 13 million Norton customers in the coming months.

In explaining the odd pairing, the firm said cryptocurrency mining is fraught with risk and often involves disabling security and allowing “unvetted code”. This leaves miners vulnerable to skimmed earnings and ransomware. Norton claims to address these issues by enabling users to safely and easily mine cryptocurrency through the user-friendly Norton 360 platform.”

Ok, so it’s for your own good. How could you doubt the fine folks at Norton?

The Internet Discovers The Existence Of Norton ’s Ethereum Program

The mining program went viral when Boing Boing editor Cory Doctorow tweeted, “Norton “Antivirus” now sneakily installs cryptomining software on your computer, and then SKIMS A COMMISSION.”

This is fucking wild. Norton "Antivirus" now sneakily installs cryptomining software on your computer, and then SKIMS A COMMISSION. https://t.co/6s2otyCd78

— Cory Doctorow (@doctorow) January 4, 2022

Security expert and journalist Brian Krebs took a look at the case and here’s what he came up with:

“According to the FAQ posted on its site, “Norton Crypto” will mine Ethereum (ETH) cryptocurrency while the customer’s computer is idle. The FAQ also says Norton Crypto will only run on systems that meet certain hardware and software requirements (such as an NVIDIA graphics card with at least 6 GB of memory).”

That doesn’t sound that bad. Plus, “NortonLifeLock says Norton Crypto is an opt-in feature only and is not enabled without user permission.” Ok, but, is the “accept” button checked from the get-go? And, why can’t people uninstall the program then? In a written statement, NortonLifeLock responded: 

“If users have turned on Norton Crypto but no longer wish to use the feature, it can be disabled by temporarily shutting off ‘tamper protection’ (which allows users to modify the Norton installation) and deleting NCrypt.exe from your computer.”

ETH price chart for 01/08/2021 on FTX | Source: ETH/USD on TradingView.com
What Was The Public’s Response To The Fact That They Are Ethereum Miners?

According to Krebs, “longtime Norton customers were horrified at the prospect of their antivirus product installing coin-mining software, regardless of whether the mining service was turned off by default”. This is what the program should protect them from. And they don’t know that this is for their own good and they should trust the Norton corporation blindly. 

On the other hand, the ones that were ok with it and wanted to collect their ETH faced another hurdle. Gas fees. If that fact is hard to navigate for experienced Ethereum users, imagine what it was for novices that weren’t even aware of their new profession as Ethereum miners. To help with visualization, just read the Norton FAQ’s explanation:

“Transfers of cryptocurrencies may result in transaction fees (also known as “gas” fees) paid to the users of the cryptocurrency blockchain network who process the transaction. In addition, if you choose to exchange crypto for another currency, you may be required to pay fees to an exchange facilitating the transaction. Transaction fees fluctuate due to cryptocurrency market conditions and other factors. These fees are not set by Norton.”

Even though what they’re saying is correct, how would a civilian react to the past year’s ridiculous Ethereum gas fees?

Summary And Conclusion, The Norton Situation

For a quick assessment of the situation, we turn to resistance.money’s Bradley Rettler, who tweeted. “What?! Norton antivirus now mines Ethereum *by default*. The “accept” button is checked automatically and once installed it’s very difficult to remove. And they take 15% of what you mine!”

What?! Norton antivirus now mines Ethereum *by default* — the "accept" button is checked automatically and once installed it's very difficult to remove. And they take 15% of what you mine! https://t.co/5OXDE76KEA

— Bradley Rettler (@rettlerb) January 6, 2022

Yeah, that’s about it. For the implications, we go back to security expert Brian Krebs:

“I guess what bothers me most about Norton Crypto is that it will be introducing millions of perhaps less savvy Internet users to the world of cryptocurrency, which comes with its own set of unique security and privacy challenges that require users to “level up” their personal security practices in fairly significant ways.”

Related Reading | Powerbridge Technologies Set To Launch Bitcoin And Ethereum Mining In Hong Kong

That seems to be about right as well. 

What would the Proof-Of-Work critics say, now that half of the planet is an Ethereum miner? And what will happen to the program once Ethereum turns to Proof-Of-Stake? Burning questions. 

Featured Image by Sigmund on Unsplash | Charts by TradingView