$3.8 Billion In Capital Inflows Behind Ethereum’s Post-Pectra Surge, Data Shows

On-chain data shows Ethereum has seen a significant rise in its Realized Cap recently, signaling the incoming of capital into the asset.

In a new post on X, the on-chain analytics firm Glassnode has talked about how the trend in the Ethereum Realized Cap has flipped since the Pectra upgrade. The Pectra upgrade went live on May 7th and introduced a bunch of improvements to the ETH network, including staking enhancements and an increase in transaction capacity.

As the chart shared by the analytics firm shows, the upgrade’s arrival seems to have coincided with a reversal in the Realized Cap of the cryptocurrency.

The Realized Cap refers to an on-chain capitalization model that calculates the total value of Ethereum by assuming that the ‘real’ value of each token in circulation is equal to the last price at which it was transacted on the blockchain.

Essentially, the Realized Cap sums up the last acquisition price for the entire ETH supply. As such, it can be looked at as a measure of the total amount of capital that the investors have put into the cryptocurrency.

From the graph, it’s visible that the Realized Cap hit a peak in early February and observed a reversal to the downside. Whenever the metric’s value goes down, it’s a sign that capital is flowing out of Ethereum.

These outflows from the asset kept on for around three months, alongside which the price naturally witnessed a downtrend. Since the Pectra upgrade, however, another reversal has occurred for the Realized Cap, as its value has started to go up instead.

On the day of the upgrade, the indicator stood at $240.8 billion. Today, it has climbed to $244.6 billion, indicating that around $3.8 billion (equivalent to a rise of 1.6%) in capital has flown into ETH in the days between.

Alongside these capital inflows, the Ethereum price has observed an explosion, as it has gone from $1,800 to the current $2,500 level. It now remains to be seen how long the Realized Cap uptrend would maintain.

While the capital flow situation of the coin has found a turnaround with the Pectra upgrade, the same hasn’t been true for network activity so far, as Glassnode has pointed out in another X post.

“Since the upgrade, the average new and resurrected addresses are down in comparison to YTD values (–1.8% and –8.4% respectively) – but churn is notably lower as well (–8.5%),” notes the analytics firm. Resurrected addresses refer to those addresses who have become active again after a period of inactivity, while churned ones are the opposite; they are the previously active addresses who have gone cold.

These trends would imply that the upgrade has failed to attract interest from new or returning users, but at the same time, it has increased engagement among the existing Ethereum users, hence the drop in churn.

At the time of writing, Ethereum is trading around $2,500, down over 4% in the last week.