After the ICO bubble burst, how is the Ethereine network developing?

This article comes from CoinGape, the original author: Nivesh Rustgi

Odaily Planet Daily Translator: Yu Shunqi


  • According to a Coinmetrics report, Ethereum has shown considerable growth in the past two years after the ICO bubble.
  • Much of the growth was attributable to the rise of stable currencies (especially Tether) in the encryption market.

The growth of Bitcoin this year has already suppressed the altcoin to the brink of extinction. Still, after the market value of many currencies rose to $1 billion, their value proposition would certainly be questioned.

The US Securities and Exchange Commission (SEC) and regulators in other countries have also suppressed ICO fanaticism. Therefore, a platform like Ethereum seems to have no use.

However, Coinmetrics' latest report says the system has grown healthily over the past two years. Although Ethereum was severely overestimated during the 2018 ICO bubble, the current NVTV ratio is reaching a turning point.

NVTV ratio

Image source: Coinmetrics, NVTV ratio

Coinmetrics introduced a new ratio to analyze network value – the NVTV ratio. A lower NVTV ratio indicates a growth in the network; another optimistic view is that the price is not fixed.

  • Odaily Planet Daily Note: NVTV stands for Network Value to Token Value, which refers to the ratio between network value and token value. The network value is the total market value of the smart contract base token. The token value refers to the platform. The total value of all assets issued. The NVTV ratio of Ethereum has been steadily declining. On April 1, 2019, the NVTV ratio of Ethereum reached an all-time low of 1.57. As of November 10, this ratio was 1.90.

Alternative and irreplaceable token growth

Not only the value of the network, but also the transactions on the network have increased. Token transactions (or ERC20 and ERC721 tokens) begin to lead ETH transactions. Changes in these indicators indicate a positive growth in the network relative to speculative activity.

Image source: Coinmetrics, token (ERC20 and ERC721) transaction vs. non-monetary (ETH transfer) transaction comparison chart

In addition, most of the growth was attributed to the growth of stable currencies over the past two years. According to a report by Coinshares, the total market value of stable currencies has increased to 2.5 times since November last year. Although Tether was accused, its market share of stable currency remained at 80%.

Image source: Coinshares, the growth of stable currency last year

More and more exchanges and wallets support USDT-ERC 20, which has contributed to its rise.

ERC-721 token transactions have also increased, most of which can be attributed to the online game Godsunchained.

On November 13, at the time of writing, the ETH price was approximately $185.9. Due to project risks and the uncertainty of the release of Ethereim 2.0, its price is further questioned.

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