The Ethereum blockchain network has risen to a 7-month high and it is pointing towards a healthy trend like never before. The data recorded portrays healthy signs for ETH. It shows how prices are consolidating along with rising developer activities. Crypto experts have always considered developer activity as a dependable indicator that captures the medium-term trend of the asset effectively.
When you attempt to evaluate the performance of a blockchain or a cryptocurrency project, there are a number of metrics that might help provide insight. Developer activity as a metric has started to take off in popularity. Put simply, developer activity refers to the amount of measurable coding effort undertaken by the people who are working to deliver the project or a platform. Most data aggregators that track developer activity usually monitor the commits posted on Github. The theory is that the more the number of commits, the higher are the number of developers working on the project. The higher level of developer activity on Ethereum is proof of an optimistic medium-term trend for ETH.
UCL School of Management professor, JP Vergne undertook a study in 2017 and said that developer activity sure stands out as one of the best predictors of a cryptocurrency price. Back then he said:
“We found that the best predictor of a cryptocurrency’s exchange rate is the amount of developer activity around it.”
And now data from Santiment and as from the graph above, we can clearly see that Ethereum’s Github development rates reached a 7-month high. Santiment researchers came out with the statement:
“Santiment is indicating that #Ethereum is reaching #Github development rates not seen since February (a 7-month high)! $ETH continues to make its case as the most highly innovative network in #crypto, including the many ERC-20’s under its umbrella.”
The rising developer activity on Ethereum comes at a time when there is a discernible spike in user activity mostly triggered by the DeFi mania. Qiao Wang, a quant trader said that DeFi unraveling is still happening with many people trying to understand what it represents truly. DeFi is new and so are the trending technologies, and it may take a while before users get a hang of it. It is also in its early stages of high growth with total value locked rising every day and already went above $8 billion. Wang believes that if people are trying to experiment with their ideas or products, it is important to get to the fundamentals. He says,
“Lotta people try to reason about DeFi on the abstract level. I had made this mistake myself. But the reality is the only way to truly appreciate what’s going on is to use the products. Spend a week to trade/lend/asset-manage, and you’ll get why this stuff is fundamentally interesting.”
Once the nuances get understood, then the developer activity on Ethereum is to rise further than the existing levels. As DeFi has started getting popular, the Ethereum network is clogged like never before. This will continue unless it is infused with more scalability.