In July 2023, Ethereum showcased an impressive growth, rising over 60%. Analysts note that this surge was due to new capital inflows rather than a rotation of investments from Bitcoin.
New Capital Inflows into Ethereum
Ethereum's July rally clearly illustrated the influx of fresh investments rather than capital outflows from Bitcoin. Data on Bitcoin's realized cap reached a new record of $1.018 trillion on July 25, indicating ongoing capital inflows.
Increase in Network Activity and DeFi
Multiple fundamental indicators reinforced the fresh capital thesis for Ethereum. According to etherscan.io data, there were nearly 1.48 million daily transactions on the network on July 27. The total value locked across Ethereum DeFi platforms surged from $49 billion to $84.6 billion between April 29 and July 29.
Record Staking Activity
In July, Ethereum liquid staking protocols reached a record milestone with 35.5 million ETH locked in these systems. The combination of reduced available supply of ETH on the exchanges and increased staking activity provided uplift for price action.
On-chain metrics indicate that Ethereum's July rally reflected genuine network growth and fresh capital allocation, with Bitcoin also attracting capital and reaching record levels.
