Ethereum holds a sizable lead over Bitcoin in an interesting adoption metric, even as its price action continues to face pressure around $2,000 to $2,100. New on-chain data shows that the ETH network’s user base has grown significantly over the past decade.
As it stands, Ethereum now has more than three times as many wallets with balances as Bitcoin, showing that the market might actually be undervalued the second largest cryptocurrency in the world.
Ethereum Support Base Goes Parabolic
Santiment On-Chain Analytics Platform recently highlighted an interesting trend in the crypto market: Ethereum’s holder base has grown far more than that of any other major digital asset.
The data shows that ETH now has around 182.7 million non-empty wallets, compared to around 58.5 million for Bitcoin. This puts ETH at over 3.1 times the number of holders held by Bitcoin, and this gap has been growing for years.
The turning point came in February 2019, when Ethereum first overtook Bitcoin in terms of the total number of addresses holding a balance. Since then, the divergence has deepened, with ETH’s portfolio growth rising while Bitcoin’s line has climbed at a much slower pace.
Tether, despite its ubiquity as the dominant stablecoin, holds only 12.96 million wallets, making Ethereum’s base more than 14 times larger. Interestingly, other notable altcoins also cannot keep up with ETH, where users are actively adding positions. The number of non-empty wallets on the XRP Ledger stands at 7.68 million, Dogecoin at 8.22 million, and Cardano at 4.61 million. None come close to Ethereum.
Price Lags Adoption, But Rally Toward $5,000 Is Intact
The bullish case for ETH is easy to understand. A network with 182.74 million non-empty wallets has a much larger user base, and this type of adoption can eventually be reflected in prices. However, the disconnection between The strength of Ethereum on-chain and its current price of around $2,000 is not lost on market participants.
For example, crypto analyst Merlijn The Trader used the Ethereum Rainbow Chart to predict a notable rally for the leading altcoin. According to the analyst, the Rainbow Chart entered its cheap zone for the first time since 2020, the same reading that preceded ETH’s rise from $700 to $4,800 in 2021.
Right now, there are two important levels to watch for Ethereum. A move above $2,500 would unlock the next band on the chart, which would open the door for a slow distribution phase towards new highs. On the other hand, a drop below $1,900 would push ETH into a flight zone based on the Rainbow model. At the time of writing, ETH is trading at $2,103, up 2.9% in the last 24 hours.
Featured image from iStock, chart from Tradingview.com
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