Kraken Australia CEO Jonathan Miller described yesterday’s Bitcoin crash as a natural correction after BTC was “dragged up” by the overheated Ether (ETH) and nonfungible token (NFT) markets.
In its August report, Kraken notes that the supply of Ether on centralized exchanges fell to a three-year low of 12.8% at the start of the month, concluding “the likelihood of supply shock capitulating ETH higher is greater.”
Miller noted that Kraken saw “a massive run-up of trading activity” leading into Ethereum’s highly anticipated London upgrade, adding that demand for Ether has sustained since.
In addition to the hype surrounding Ethereum upgrades and EIP-1559 going live, Miller attributes the recent crypto rallies to the mania surrounding NFTs.
In its report, Kraken noted that the NFT platform saw an explosion of growth during August, with OpenSea’s daily users gaining 289% and trade volume rising 900%, according to a weekly moving average.
“The combination of Bitcoin being […] dragged up a little bit by Ethereum, Ethereum