Ethereum network upgrade and uptick in Arbitrum active users could trigger an ARB price reversal
The space in between the number of active users on Arbitrum and Optimism widened after the Aribtrum airdrop, closing in on Ethereum.Daily active users of Arbitrum, Ethereum and Optimism (past 6 months). Source: DefiLlamaMoreover, Nansens report shows that ARB airdrop receivers only accounted for around 5% of the activity on the blockchain and that Arbitrum has brought in substantially more new users after the airdrop.Potential drivers for ARB upside Moreover, an upcoming update on Ethereum in the second half of 2023, called as Cancun-Deneb (Dencun), will include EIP-4844 (proto-Danksharding), which will lower the deal costs on Arbitrum, increasing the blockchains worth proposition.Additionally, the Arbitrum Foundation just recently exposed collected data from its sequencer, a part of the layer-2 fees paid by users for publishing the data onto Ethereum. The foundation has decided to pass on the sequencers earnings, totaling 3,352 Ether (ETH), or $5.4 million, to the Arbitrum DAO, and the ETH will be handled by ARB holders.
A current Nansen report shows that Arbitrums activity enhanced after the airdrop, stabilizing “at a level higher” than before the airdrop. The space in between the number of active users on Arbitrum and Optimism expanded after the Aribtrum airdrop, closing in on Ethereum.Daily active users of Arbitrum, Ethereum and Optimism (previous 6 months). Source: DefiLlamaMoreover, Nansens report shows that ARB airdrop recipients just accounted for around 5% of the activity on the blockchain and that Arbitrum has actually brought in substantially more brand-new users after the airdrop.Potential catalysts for ARB upside Moreover, an upcoming update on Ethereum in the second half of 2023, called as Cancun-Deneb (Dencun), will include EIP-4844 (proto-Danksharding), which will minimize the transaction costs on Arbitrum, increasing the blockchains value proposition.Additionally, the Arbitrum Foundation recently revealed collected information from its sequencer, a part of the layer-2 fees paid by users for publishing the data onto Ethereum. The structure has chosen to pass on the sequencers incomes, amounting to 3,352 Ether (ETH), or $5.4 million, to the Arbitrum DAO, and the ETH will be handled by ARB holders. The upcoming Dencun upgrade on Ethereum and choices taken by the Arbitrum Foundation in directing revenue from the L2 rollup will eventually dictate ARBs rate action.This short article does not contain financial investment guidance or suggestions.
If the neighborhood votes to direct the benefits to holders, a revenue source for the DAO– a decentralized autonomous organization– can possibly produce yields for ARB holders. It stays to be seen how the funds will be managed by the foundation and the DAO.”Smart money” is holding ARBNansens information shows that the “wise cash” and funds that collected ARB after the airdrop still havent sold, which is motivating. The on-chain analytics firm tags Ethereum addresses of profitable and high-volume traders as “smart cash.”Funds (purple) and smart wallets (green) are still holding ARB. Source: NansenThe financing rate for ARB perpetual swap contracts turned negative like the rest of the crypto market after the Securities and Exchange Commission (SEC) brought lawsuits against the industrys biggest exchanges, Binance and Coinbase, per CoinGlass data.Related: Deposits to zkSync surpass $110M as its DeFi ecosystem explodesFunding rates are paid by perpetual swap traders for shorting or yearning a possession depending upon its demand. If the demand for short orders is higher, it is considered more costly, so traders on the brief side pay longs. Currently, the financing rates are near zero, recommending that futures traders are neutral on ARB. Financing rate across the perpetual swap markets. Source: CoinGlassThe ARB/USD set has observed a down trend because the tokens launch in March. The compression of the channel shows the possibility of a descending wedge pattern, which tends to break to the benefit. Nevertheless, if ARB breaks listed below the support line of the wedge pattern around $0.90, the transfer to the disadvantage can amplify quickly.ARB/ USDT daily price chart. Source: TradingViewOn the ETH scale, ARB broke listed below Mays low of 0.00057 ETH after the SECs lawsuits. At the time of publication, the token was trading at 0.00056 ETH. ARB/ETH 4-hour rate chart. Source: GeckoTerminalTechnically, ARB shows the possibility of a negative trend turnaround. The upcoming Dencun upgrade on Ethereum and decisions taken by the Arbitrum Foundation in directing income from the L2 rollup will ultimately dictate ARBs cost action.This short article does not contain investment advice or suggestions. Every investment and trading move involves threat, and readers must conduct their own research study when deciding.
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