Fusaka's new Ethereum addresses surged by 110% after the upgrade, but mid-term holders have become a ticking time bomb

Since the Fusaka upgrade on December 3rd, Ethereum network activity has experienced a significant rebound. The number of new addresses has increased by approximately 110%, currently adding about 292,000 addresses daily. This figure looks impressive, but a deeper look into the holder structure reveals a hidden risk: mid-term holders who entered after mid-July are still at a loss, while profitable investors are eager to sell. The results of the upgrade and the selling pressure from holders are playing out a “Game of Thrones” of ice and fire.

The Phenomenon of User Growth Driven by the Upgrade

The true meaning behind the growth of new addresses

A 110% increase in new addresses sounds astonishing, but understanding the driving forces behind it is essential. According to the latest news, this growth mainly stems from two aspects: first, the technological breakthrough brought by the Fusaka upgrade; second, seasonal factors stacking together.

The core advantage of the upgrade lies in the introduction of PeerDAS technology—this innovation significantly reduces data costs on L2, further lowering transaction fees on Ethereum L2. What does this mean? It means retail investors and small traders who were previously excluded due to high Gas fees now have a chance to re-enter the ecosystem. The daily addition of 292,000 addresses is largely due to this group of users being “driven away by Gas fees” returning.

Structural reasons for accelerated user adoption

Analysis indicates that this growth reflects the combined effect of seasonal factors and structural upgrades. Specifically:

• Technical level: L2 transaction costs drop sharply, lowering usage barriers
• Ecological level: RWA (Real World Asset) tokenization on Ethereum gains ground, attracting institutional and traditional financial participants
• Market level: Year-end market sentiment warms up, enthusiasm for new user entry surges

These three factors together have caused explosive growth in new addresses. But it’s important to note that new addresses do not necessarily mean active new users, nor do they mean new holders. Many new addresses may just make a single transaction and then disappear.

Changes in Holder Structure: Potential Selling Pressure

Risks Revealed by HODL Waves Indicator

The key data here comes from the HODL Waves indicator. The number of mid-term holders holding Ethereum for three to six months has increased, which should be a positive signal, but the issue lies in the timing of their positions.

What does this structure imply? It indicates that there is a sizable group of holders who have already seen their accounts turn green. In the crypto market, nothing fuels selling desire more than “being in profit.”

Price increase may trigger chain reactions

According to recent analysis, a price rise could trigger these holders to sell. The logic is straightforward:

• Investors who entered in early July may have a cost basis around $2000–$2500
• Current price at $3185 means they are already making a 30-50% profit
• If prices continue to rise, profit margins expand, and selling motivation increases

For those who entered after mid-July and are still at a loss, they may not sell actively for now, but once the price returns to their cost basis, they will become “break-even” sellers. The combination of these two waves of selling could exert significant pressure on the price.

Balancing Upgrade Results and Market Pressure

The fundamentals are genuinely improving

It’s undeniable that the Fusaka upgrade has improved Ethereum’s fundamentals:

• Further optimization of L2 transaction costs
• Lower entry barriers for new users
• Increased ecosystem activity
• Greater institutional participation (e.g., BlackRock and others)

These are tangible positives. The past week, ETH rose by 5.94%, reflecting market recognition of these improvements.

But structural pressures cannot be ignored

At the same time, changes in holder structure bring real pressure:

• The scale of profit-taking among mid-term holders is not small
• Every price increase amplifies selling pressure
• It remains uncertain how many new entrants will become long-term holders

It’s like a balance scale: on one side, fundamental improvement driven by the upgrade; on the other, profit-taking pressure from holders. In the short term, which side tips the scale depends on price performance.

Future Focus Areas

Key indicators to watch include:

1. Activity of new addresses: Will these new users truly stay?
2. Selling pace of holders: Will mid-term holders dump all at once or sell in batches?
3. L2 trading volume: Can the upgrade’s advantages continue to translate into trading activity?
4. Institutional capital movements: Will progress in RWA tokenization attract more institutional participation?

Summary

The Fusaka upgrade has indeed brought new vitality to Ethereum, with the daily addition of 292,000 new addresses proving this. But the flip side is that a considerable amount of profit-taking has already formed in the market. The influx of new users and the profit-taking pressure from existing holders are playing a silent game of chess.

The results of the upgrade are real, but that doesn’t mean the price will go smoothly. The key moving forward is which force will dominate. For holders, it’s important to recognize the long-term value of the upgrade while remaining alert to short-term structural pressures. This isn’t a simple bullish or bearish question, but an understanding of the complex market game underway.