Ethereums realized cap spikes to record highs as capital floods in: Report

Wednesday 27 January 2021, 1:10 PM AEST - 1 month ago

Ethereums realized capitalization has increased by nearly 50% in January so far to tag new all-time highs above $70 billion, according to CoinMetrics.

The data shows that Ethereums realized cap has more than tripled since dropping below $25 billion in during March 2020s Black Thursday crash..

8d5aef23-9949-45f3-86ad-72318c83ec2c.pngEthereums realized cap: CoinMetrics

The realized capitalization metric calculates the value of a crypto assets supply according to when each unit last moved on-chain. The indicator seeks to estimate the price actually paid for each ETH in circulation — rather than simply multiply the current price by the total supply as market cap does. However, realized cap cannot account for coins that are only traded on centralized exchanges and do not move on-chain.

The indicator is designed to offer a way to compensate for lost or unclaimed coins by ignoring their appreciation from the time each unit was last transferred on-chain.

By ignoring the fluctuating capitalization of dormant coins, realized cap offers a signal for when new capital is flowing into a given market, with CoinMetrics inferring that many new investors may have been buying the bags of seasoned ETH whales during Januarys bull market.

The report also noted a 5% spike in the number of Ethereum addresses holding more than 10,000 Ether, with 1,241 wallets currently holding $13.8 million or more in ETH. As such, CoinMetrics concludes that institutional investors are starting to buy ETH.

The growth of Ethereums realized cap appears to have outperformed that of Bitcoin's last year, with Glassnode reporting that BTCs realized cap had grown 50% since the beginning of 2020 as of De ...

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