Fed’s Quantitative Easing: What’s In Store For The ETH/USD Pair?

• A risk to Ethereum‘s price could come from a Fed statement rejecting the QE policy this week, which may cause a decline.
• The Ethereum ecosystem experienced a new ATH, with 10.94M L2 weekly active addresses remaining robust.

The ETH/USD pair has historically shown a close relationship with Federal Reserve policy, especially during the quantitative easing (QE).

In a recent X post, Benjamin Cowen, ITC Crypto CEO, claimed that the Fed may not provide an imminent QE schedule. If this happens, it would cause a significant decline, and the Ethereum price may be downturned.

A potential adjustment from the Federal Reserve by March 2025 might trigger ETH’s rapid recovery. The Ethereum price was trading at $3203 at press time, noting a rise of over 3.20% in the past 24 hours.

ETH/USD failed to surpass the $4000 barrier in past years amidst multiple attempts.

Ethereum Hits New Heights in Network Activity

Layer 2 (L2) networks achieved their highest level of distinct weekly active addresses last week when they rose to 10,942,006. At the same time, they showed a 24.9% increase.

Cross-chain engagement remained robust as 580,853 users engaged actively across multiple Layer 2 networks. Ethereum Layer 1 achieved substantial growth with a total number of 2,458,330 unique addresses.

The dramatic increase in activity was driven by the strong performance of Base and Arbitrum One among all chains. The network activity numbers for Base reached 6,762,005, while Arbitrum One registered 1,931,903 distinct addresses.

User activity in on-chain solutions became more evident. Over 10,000 contracts have been deployed to the Ethereum ecosystem within 24 hours.

The network’s rapid expansion demonstrated positive signs of its vitality. This predicts strong development growth and heightened user participation rates.

USDT & USDC: Comparing Stablecoin Activity on Ethereum vs. Solana

The ETH/USD network experienced a $2.06 Billion increase in stablecoin holdings. This was closely trailed by Solana’s $2.04 Billion gain the previous week.

These significant gains indicated substantial liquidity increases. This brought added stability and utility to these cryptocurrency networks during market downturns.

Other notable projects showed significant growth as Tron gained $385 million. At the same time, Avalanche marked a growth of $353.37 Million, respectively.

Ethereum Price Analysis: Is a Reversal Toward $3500 on the Horizon?

Per the daily timeframe analysis, Ethereum price has taken support on the 200-day EMA mark. Furthermore, ETH/USD seemed to be consolidating within a falling wedge pattern and hovered around the $3200 mark.

The price action and on-chain metrics offered a promising outlook. This is because the Ethereum coin could see a breakout above the channel’s upper trajectory of $3400.

If it crosses the $3400 mark, it could potentially reach the $3800 level in the upcoming sessions. In the last 24 hours, the Open Interest (OI) has risen over 0.51% to $31.60 Billion in the past 24 hours.

Moreover, the OI-weighted funding rate remained positive at 0.0096%. This conveyed heightened demand for the long contracts.

Disclaimer

In this article, the views and opinions stated by the author or any people named are for informational purposes only, and they don’t establish the investment, financial, or any other advice. Trading or investing in cryptocurrency assets comes with a risk of monetary loss.