The total value of assets locked on Ethereum (TVL) has risen more than other networks over the past week. At the same time, the price of ETH made a breakthrough of $4,000.
Over the past week, the total value of assets locked in Ethereum (TVL) has increased by $7.79 billion. This value makes the network the blockchain with the largest TVL growth over this period. In addition, at the same time, the price of ETH made a run towards $4,000. This indicates renewed investor confidence in the cryptocurrency.
Confidence in Ethereum reaches new heights
On December 2, Ethereum’s TVL was just under $70 billion. Today, this figure has risen to $77.15 billion. TVL is an important indicator in the cryptocurrency and decentralized finance (DeFi) ecosystem. It shows the total value of assets locked or staked in decentralized applications (dApps), smart contracts or blockchain protocols.
This metric serves as an indicator of growth, adoption, and user confidence in the platforms’ functionality and security. A high TVL indicates that more users are interacting with these systems. On the other hand, a decrease in the indicator indicates a decrease in liquidity, which indicates a drop in the volume of deposits on the blockchain.
Thus, the growth of Ethereum TVL indicates increased confidence in decentralized applications and protocols based on Ethereum.
Continuing the trend could lead to a further increase in the price of ETH, as an increase in TVL is often associated with an increase in demand for the asset. For comparison, TVL of Tron and Solana also increased by $900.23 million and $618.40 million.
Additionally, according to Glassnode, Ethereum inflows to exchanges have fallen to their lowest level in over a month. When inflows to exchanges increase, it means that holders are ready to sell. However, its decline indicates that many ETH holders have decided not to sell their holdings, which is good for the price.
Influx of Ethereum to exchanges. Source: Glassnode
ETH Forecast: $4,200 target on the horizon
The 3-day chart shows that the cryptocurrency traded in a descending triangle from June to November. The Descending Triangle is a commonly seen bearish pattern. It is formed by a downward trend line connecting a series of lower highs and a flatter line acting as support that the price tests several times.
A descending triangle usually indicates that sellers are gaining control. This could potentially lead to a break below the support line. However, the ETH price exited this channel in a northerly direction. This suggests that the asset’s value may rise.
If the trend continues, the price could rise above $4,096 and reach $4,200 in the near future. But if sales intensify and Ethereum TVL falls, this forecast may not come true. Then ETH could drop to $3,175.
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Source: Cryptocurrency
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