Ethereum Today News: Active Addresses Hit 5-Month Low, US ETF Dumps $220 Million

Ethereum prices hover around $2,960, but on-chain data reveals a deeper crisis. Weekly active addresses dropped from 440,000 to 324,000 in December, hitting the lowest level since May, with a net loss of 116,000 addresses in the month. Meanwhile, the US spot ETH ETF experienced three consecutive days of net outflows totaling $224.78 million, indicating renewed selling pressure from US investors.

US Selling Wave Resumes, Ethereum ETF Outflows $220 Million

The most concerning signal from today’s Ethereum news comes from sustained selling pressure in the US market. According to SoSoValue data, the US spot Ethereum ETF experienced net outflows for the third consecutive trading day, amounting to $224.78 million. More alarmingly, since December 10, the total net assets of these products have plummeted from $21.43 billion to $18.27 billion, a loss of over $3 billion in just two weeks.

This selling wave is set against a backdrop of strong employment reports. The latest data shows the unemployment rate reaching 4.6%, the highest since 2021. While rising unemployment is typically seen as a sign of economic weakness, in the current context of Federal Reserve tightening policies, it may instead delay rate cut expectations, putting pressure on risk assets. As US investors anticipate prolonged high interest rates, capital naturally flows out of volatile cryptocurrencies and into more stable fixed-income products.

The combination of ETF capital outflows and the turning negative premium on the US’s largest compliant crypto exchange often signals the start of a mid-term correction. Similar situations occurred in August 2024, when ETH retreated from $3,500 to $2,200, a decline of over 37%. While the current situation may not repeat the same script, the warning signs are clear.

Active Addresses Hit May Low, User Loss Accelerates

(Source: CryptoQuant)

On-chain data reveals deeper issues than price alone. Ethereum’s weekly active addresses sharply declined in December, dropping from 440,000 to 324,000, the lowest since May. The month saw a net loss of 116,000 active addresses, a 26.4% decrease, an extremely rare scale of user attrition.

Active addresses are a key indicator of blockchain network health. They reflect not only the number of price speculators but more importantly, real users engaging in transfers, transactions, and smart contract interactions. When active addresses continue to decline, it indicates that actual network usage demand is shrinking.

Three Major Warnings of Ethereum On-Chain Activity Contraction

· Weekly active addresses plummeted from 440,000 to 324,000, a 26.4% monthly decline, hitting a new low since May

· Transaction volume dropped to July lows, indicating not only fewer users but also declining activity per user

· Investors shift to a wait-and-see mode, with a lack of new capital inflows and network usage demand, creating a negative feedback loop

The continuous decline in active addresses and transaction counts suggests investors are cautious. This wait-and-see attitude is common during heightened market uncertainty, but the concern lies in its duration. If activity remains subdued for weeks or even months, it can form a self-reinforcing negative cycle: user loss → reduced network activity → decreased price attractiveness → further user loss.

Lack of demand may lead to price declines or sideways consolidation until network activity rebounds. Historically, lows in Ethereum active addresses often correspond to cyclical bottoms in price, but this bottoming process can take several weeks. The current 324,000 active addresses are close to May levels, when ETH price consolidated in the $2,800-$3,000 range for nearly a month before resuming upward movement.

Support and Resistance at $2850 and Technical Outlook

(Source: Trading View)

On the technical side, today’s focus is on the battle around the $2,850 support level. According to Coinglass data, ETH experienced $105.4 million in liquidations over the past 24 hours, with long liquidations totaling $73.6 million, accounting for 70% of total liquidations. This long liquidation dominance indicates leveraged longs are being ruthlessly wiped out.

ETH briefly rebounded from the $2,850 support, currently trading around $2,960, but the bearish momentum remains dominant. The Relative Strength Index (RSI) continues to decline, staying below the neutral level of 50, currently around 42, indicating ongoing bearish momentum. Notably, the Stochastic Oscillator has entered oversold territory, with readings below 20. An oversold condition may trigger a short-term reversal, but confirmation from volume is needed.

If ETH price rises and breaks through the $3,100 resistance, the next target could be $3,470, the local high from early December. This scenario requires two conditions: ETF capital outflows cease and turn into inflows, and active addresses stop declining and start to recover. However, based on current fundamentals and capital flow data, the probability of achieving these conditions in the short term is low.

Conversely, if ETH price falls below the $2,850 support, it could retreat to the support zone around $2,400-$2,600. This zone served as a consolidation platform in November and is a major cost basis area for many positions. If $2,850 is broken, it may trigger a chain of stop-loss orders, accelerating the decline.

The market is at a critical turning point, with bulls and bears fiercely contesting the $2,850-$3,100 range. US selling pressure, declining active addresses, and oversold technical indicators create a complex set of signals. Investors should closely monitor ETF capital flows and on-chain activity changes, as these will determine whether Ethereum can hold the $2,850 support line.