Ethereum (ETH) price prediction: on-chain activity surged by 35%, RWA scale skyrocketed by 680% in two years revealing institutional bullish confidence.

Despite the recent fall of 2.58% in the price of Ethereum (ETH) to $4,376, its network fundamentals are showing strong structural growth, in stark contrast to the price movement. On-chain data reveals that the internal contract call volume of Ethereum has surged by 35% to over 9.5 million times per day, reflecting a significant rise in DeFi and RWA (Real World Asset) tokenization activities. Among them, the total scale of Ethereum RWA tokenization has skyrocketed by 680% to $11.71 billion in less than two years, while Grayscale has staked $5.14 billion in Ethereum, indicating that despite short-term price weakness, institutional confidence in Ethereum's long-term prospects is at an all-time high.

Strong Fundamentals of the Network: Explosive Growth in Contract Call Volume and RWA

On-chain data indicators show that the usage rate and economic activity of the Ethereum network are accelerating, and this rise is structural.

(Source: CryptoQuant)

· Contract call volume surged by 35%: According to data from CryptoQuant, the internal contract call volume on Ethereum has jumped to over 9.5 million per day, a 35% increase from the previous average of 7 million calls per day. These calls are a key indicator of complex network interactions, including the operations of Decentralized Finance (DeFi) and activities related to RWA tokenization.

· Structural drivers of growth: This growth, which began in mid-July and has remained stable, is not a fleeting phenomenon. Analysts attribute it to three main driving factors: increased regulatory clarity around stablecoins in the U.S., record inflows into spot Ethereum ETFs, and large companies adding ETH to their balance sheets.

· RWA market share reaches 56.27%: Ethereum's dominance in the RWA tokenization space is unmatched. Its tokenized RWA scale has skyrocketed from $1.5 billion on January 1, 2024, to the current $11.71 billion, with a growth rate of up to 680%. Ethereum holds a 56.27% share of the RWA tokenization market, nearly five times that of the second network ZKsync Era (11.83%).

· Institutional leadership: The BUIDL fund issued by BlackRock is one of the largest tokenized RWA products, with a scale of approximately $2.4 billion solely on Ethereum.

Divergence in Behavior Between Institutions and Retail Investors: $5.14 Billion in ETH Staking Signals

While the price is falling, the actions of institutional investors contrast sharply with those of retail traders, revealing different expectations for the future value of Ethereum.

· Grayscale's $5.14 billion stake: Grayscale staked over 5.14 billion dollars in Ethereum this week, marking one of the largest institutional commitments to Ethereum staking to date. This move sends a strong signal indicating that large institutions have firm confidence in the long-term value of Ethereum and staking yields.

· Sharp contrast: This institutional behavior stands in stark contrast to retail traders. Large investors tend to accumulate Ether during price weakness for stability and yield, while retail traders are more inclined to chase the more volatile Meme coins on networks like BNB Chain. This pattern often appears in market cycles, reflecting the institutions' contrarian investment strategy.

· Market sentiment is cautious: Despite strong fundamentals, the market still shows cautious sentiment. The market capitalization of Ethereum is currently $528.26 billion, but in the past 24 hours, trading volume has decreased by 23.11% to $44.16 billion.

Technical Analysis: Short-term under pressure, long-term still bullish

From a technical chart perspective, Ethereum faces short-term resistance levels and correction risks, but the structure of the long-term rise trend remains intact.

· Key resistance level hit: In less than ten weeks, Ethereum has failed to break through the $4,800 resistance level for the fourth time. The price plummeted to $4,300 on Thursday and is currently stabilizing around $4,400.

· Support Range: Technical analysts are closely monitoring the range of $4,100 to $4,250, which overlaps with the previously concentrated buying activity in the "daily and four-hour order blocks," forming an important support.

· Momentum Indicator: The Relative Strength Index (RSI) on the four-hour chart is approaching the oversold zone, which may indicate that a short-term bottom is forming. However, the RSI on the weekly chart is in the bullish zone (61.22) but has decreased from 66, suggesting that short-term momentum is weakening, and the MACD also shows convergence, indicating a potential bearish crossover risk.

· Bullish structure unchanged: Analyst Jelle pointed out that Ethereum has successfully broken through the "Megaphone Pattern" and has completed the shakeout after a retest, now seems ready to continue rising. Trader Crypto Caesar believes that even if it falls below $4,000, it may just be the "last washout," maintaining the target price of hitting $10,000 later this month.

Conclusion

Ethereum is currently caught in a short-term contradiction of "strong fundamentals and a cooling price." The explosive growth of internal contract calls on the network and RWA tokenization, along with Grayscale's institutional action of staking $5.14 billion, provides strong long-term value support for Ethereum. Although the price faces a correction risk in the range of $4,450 to $4,500 in the short term, as long as it can hold the key support of $4,100 to $4,250, its long-term bullish structure, especially benefiting from the narrative of RWA, will continue to drive the price towards higher targets.

Disclaimer: This article is for informational purposes only and does not constitute any investment advice. The crypto market is highly volatile, and investors should make decisions cautiously.