Immutable X reclaimed $1.50 for the first time since May 2022 crypto crash. On-chain metrics show that declining network growth could slow down a potential IMX price rebound.
Immutable X (IMX) long-term holders appear to have been taking profits since February.
IMX Network is Not Growing
Immutable X (IMX) is a layer-two scaling solution for NFTs on the Ethereum smart contract network. It allows NFT traders and creators to carry out fast transactions at near-zero gas fees.
IMX rose to prominence as global interest in NFTs reignited in early 2023. However, with the NFT boom now cooling, critical on-chain metrics reveal that IMX appears to be struggling to find new demand.
The number of new addresses created on the IMX network has been declining, according to on-chain data from Santiment.
As seen below, network growth peaked along with the price on March 17. Since then, it has declined from 594 to 84 new addresses created as of March 24.
When network growth declines persistently, it is a bearish signal that the underlying token may struggle to find new demand. Hence the current network traction downtrend may hurt the growth prospects of IMX in the coming weeks.
Also, the profit-taking frenzy among IMX long-term holders further validates the bearish outlook. As illustrated by the red line in the chart below, long-term holders appear to have been selling since early February.
In the Santiment chart below, IMX Mean Coin Age (90d) has dropped from 60.43 on Feb. 2 to 28.78 as of March 24.
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Author: Ibrahim Ajibade
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