Ethereum Active Addresses Drop 24%, Price Follows Bearish Trend

Ethereum’s daily active address count has extended a multi-week decline, falling dramatically from roughly 480,000 in mid-August to nearly 363,000 by October 26. This 24% contraction represents more than just a superficial on-chain dip—it indicates significantly lighter engagement across the entire Ethereum network. Fewer users are interacting with smart contracts, decentralized applications (dApps), and conducting transfers, suggesting a broader cooling of network participation that extends beyond simple price fluctuations.

The 7-day moving average of active addresses provides even more convincing evidence of this structural decline. By stripping out daily noise, this metric has retraced from the 480,000 area to roughly 370,000, highlighting that the drop is steady rather than sporadic. This sustained decrease in fundamental network activity points to reduced user presence, diminished capital flow, and weaker overall network demand—all critical indicators for Ethereum’s ecosystem health and long-term viability.

The correlation between Ethereum’s network activity and price direction has become strikingly evident during this period. As active addresses declined by 24%, ETH’s price tracked this deterioration almost exactly, dropping from the upper $4,800 level toward the $3,900 region during the same window. This relationship underscores how deeply intertwined active address trends have historically been with price direction, serving as a reliable proxy for network demand and capital flow.

At the time of writing, Ethereum is trading at around $3,714, extending its recent slide as bearish sentiment continues to pressure the market. Over the past month, the leading altcoin has declined by approximately 17.4%, with the weakness intensifying further in the near term through a fresh 5% drop in the past 24 hours alone. This price action confirms that the reduction in network fundamentals is having a direct impact on market valuation.

According to CryptoQuant’s data analysis, the current network activity trends suggest that bears hold the advantage in the near term. The firm’s assessment indicates that ‘unless we see a strong and sustained rebound in active addresses, any potential price rally may remain fragile.’ This warning emphasizes that traders should treat the ongoing decline in fundamental network activity as a critical signal in their analysis, rather than focusing solely on technical price patterns.

Following the latest price dump, crypto analyst Ted Pillows identified that ETH has now reached a critical support zone. Pillows suggests that if buyers defend this support strongly, there is room for a rebound toward the $4,000 region. However, the analyst warns that if price breaks convincingly below this zone, a sharper continuation lower could potentially send Ethereum toward and even beneath the $3,500 area. This technical assessment aligns with the fundamental data showing weakening network engagement.

The combination of declining active addresses, falling prices, and analyst concerns creates a challenging environment for Ethereum. Without a noticeable rebound in address activity, the network faces the prospect of continued pressure on both fundamental and technical fronts. The current situation highlights how critical user participation and network engagement are for sustaining cryptocurrency valuations, particularly for ecosystem-heavy platforms like Ethereum that rely on active dApp usage and smart contract interactions.