Bitcoin and Ethereum are currently surviving a bearish scare, with both assets barely remaining above their immediate supports. The $41,000 level is establishing a strong bounceback range for Bitcoin, while Ethereum has managed to stay above $3000.
On the contrary, some altcoins have seen significant gains, with Solana, Bitcoin Cash, and Uniswap all increasing by more than 10% in a 24-hour period.
At press time, these altcoins appeared to have the upper hand. However, there are a few key metrics that may allow us to assess the true strength of Bitcoin and Ethereum as the market progresses.
How much weight should utility be given?
Market stability has been influenced by a variety of factors in recent years. During the bullish rally of 2017, investor sentiment was critical, and when major traders began to turn bearish, digital assets crashed.
Then, at the start of 2019, it was positive institutional inflows. It was suggested at the time that institutions could allow tokens such as BTC and ETH to have higher price positions. Regardless of rising interest rates, the price fell in 2020.
However, one key concept that most speculators may overlook is the utility side of things, which is currently one of the most important functionality. The days of astute marketing allowing assets such as TRON to climb into the top ten are long gone.
Bitcoin has now reached a two-month high in terms of circulation, according to Santiment. Furthermore, if the chart is closely examined, the average BTC transferred has consistently increased during the month of September.
Similarly, Ethereum accomplished the same feat, but its 1-day circulation index was at a 3-month high, indicating high token utility and movement.
The price of Ethereum has dropped dramatically in recent weeks, but circulation has remained high.
The Bitcoin and Ethereum markets have evolved.
To be fair, it is necessary to account for volatility as well as the fact that circulation isn’t as high as it was in May 2021. Maintaining a development and transaction-intensive ecosystem, on the other hand, allows the price to be built on solid foundations in the long run.
In terms of the assets that have grown in the last few days, aside from BCH, both Solana and Uniswap are widely used tokens. While one asset is the native token of a major DEX, another is currently in charge of bringing better L2 solutions.
Similarly, higher utility and circulation for Bitcoin and Ethereum should keep the asset relevant and gradually show significant recoveries over the fourth quarter of 2021.