Ethereum is currently experiencing a significant surge in on-chain activity, with key metrics reaching yearly highs. Data from the network shows that daily transactions and the number of active wallet addresses have climbed to levels not seen since the peak of the previous market cycle. This spike in activity, with active addresses surpassing 674,000, is a strong indicator of growing network adoption and sustained demand beyond short-term speculative interest.
<h2>The Role of EIP-1559 in Supply Dynamics</h2>
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This heightened demand is occurring alongside a notable tightening of Ethereum’s circulating supply, a trend directly influenced by the network’s EIP-1559 mechanism. According to an analyst from Crypto Potato, this protocol continuously burns a portion of ETH, which keeps the net emission rate near zero even during periods of market flux. This deflationary pressure, coupled with increasing network usage, creates a powerful foundation for a more stable and robust market. The dual effect of rising demand and a limited, or even decreasing, supply is a crucial factor in Ethereum’s long-term value proposition.
<h2>A Signal of Quiet but Strong Growth</h2>
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The combination of surging on-chain activity and a tightening supply paints a picture of "quiet but strong growth," as described by analysts. Instead of a speculative bubble, the metrics suggest a healthy, organic expansion of the network. The sustained high levels of active and new addresses indicate that new users and applications are consistently joining the ecosystem. This fundamental strength, if key support zones for the price hold, could set the stage for a significant market rebound, with some analysts forecasting a potential return to the $4,000 price level.

Ethereum Supply Tightens as On-Chain Activity Soars to Yearly Highs

Ethereum's on-chain activity and active addresses surge to yearly highs, while EIP-1559 tightens supply, signaling strong, quiet growth.

Ethereum Supply Tightens as On-Chain Activity Soars to Yearly Highs

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