On Tuesday (May 26), crypto-focused research boutique Blockfyre explained why its analysts believe that "Ethereum is significantly undervalued at current prices."
Blockfyre says its analysis is focused on the following four progress indicators for Ethereum:
- Development Activity (developers keep improving Ethereum regardless of how the Ethereum price is doing)
2) Development Activity— Blockfyre (@blockfyre) May 26, 2020
Since 2014, the Ethereum foundation and its developers have constantly increased the development activity for the network, regardless of what the price has been doing.
This indicates the health of the network, being positive for investors. pic.twitter.com/MhtGE7p9IJ
- Gas Used (activity on the Ethereum network keeps growing, mostly thanks to growing interest in stablecoins, which are mainly built on Ethereum)
3) Gas Used— Blockfyre (@blockfyre) May 26, 2020
The amount of Gas Used on the network is constantly increasing and even hitting ATHs at the moment, indicating the growing adoption of the Ethereum network. pic.twitter.com/KBtONxV6gw
- Mean Dollar Invested Age (investors like HOLDing Ethereum)
4) Mean Dollar Invested Age— Blockfyre (@blockfyre) May 26, 2020
This measures for how long $ETH has stayed in its address without being moved.
Since 2018, this metric has constantly increased, while recently hitting ATHs, showing that investors prefer to accumulate and hold at these price levels. pic.twitter.com/nO36Dl15he
- Miner's Balance (miners like HODLing Ethereum too)
5) Miner's Balance— Blockfyre (@blockfyre) May 26, 2020
More interestingly, the same applies to the $ETH Miner's Balance.
This indicates that even Miners, who actually need to sell their mining rewards to cover their expenses, prefer to hold at current price levels. pic.twitter.com/JKi7XZnLjr
The charts of these four progress indicators against the change in price of Ethereum over time leads Blockfyre to conclude that although the price of Ethereum has gone down a lot since its all-time high in January 2018 and Ethereum has been trading "sideways" since th end of 2018, these indicators paint a promising outlook for the Ethereum network and the Ether cryptocurrency.