Ethereum

Bitcoin

Spot

<p>The cryptocurrency community has been monitoring ETH Price trajectory, since <a href="https://coingape.com/education/ethereum-etf-approved-everything-you-need-to-know/" rel="noopener noreferrer nofollow">Ethereum ETF</a> was approved by the SEC. Although the global crypto market has been experiencing volatility, with <a href="https://coingape.com/trending/4-top-altcoins-set-for-100x-gains-in-june-2024/" rel="noopener noreferrer nofollow">altcoins</a> experiencing the effect, Ethereum has grown in value, trading slightly above $3,800. With only 22% away from achieving its previous all-time high of $4,891.70 it achieved on Nov 16, 2021, there are speculation that it could soon achieve this milestone once again. In this article we delve into the top reasons driving this potential price increase.</p>
<h2 id="strong-1-a-potential-supply-squeeze-strong"><strong>1 .A Potential Supply Squeeze</strong></h2>
<p>Since the approval of spot Ether ETFs on May 23, over $3 billion worth of Ether has been withdrawn from centralized exchanges. <a rel="noopener noreferrer nofollow" href="https://cryptoquant.com/asset/eth/chart/exchange-flows/exchange-reserve?exchange=all_exchange&amp;window=DAY&amp;sma=0&amp;ema=0&amp;priceScale=log&amp;metricScale=linear&amp;chartStyle=line" target="_blank">CryptoQuant</a> data indicates that this translates to 797,000 Ether removed from exchanges between May 23 and June 2.</p>
<p>This substantial outflow of Ether suggests that investors are opting for self-custody solutions, thereby reducing the amount of Ether available for immediate sale. Such a decrease in supply, paired with rising demand, often leads to a price surge—a classic example of a potential supply squeeze.</p>
<h2 id="strong-2-ethereum-etfs-and-surrounding-positive-sentiment-strong"><strong>2. Ethereum ETFs and Surrounding Positive Sentiment&nbsp;</strong></h2>
<p>The launch of Ethereum ETFs is an important element that has potential to push the ETH price to remarkable levels. Analysts such as Eric Balchunas from Bloomberg, have predicted a high chance of these ETFs being granted a go ahead by the end of June. The excitement surrounding these ETFs is similar to the effect observed with Bitcoin ETFs, which greatly increased <a href="https://coingape.com/price/bitcoin" rel="noopener noreferrer nofollow">Bitcoin price</a> after they were introduced.</p>
<p>There is optimism among some analysts that Ethereum could reach a new all-time high of $4,870 from November 2021 when spot Ether ETFs become available for trading. This optimism is driven by the anticipated rise in demand pressure from these ETFs.</p>
<p>The positive sentiment towards the possible introduction of spot Ether ETFs is also causing an increase in Ether’s price. <a rel="noopener noreferrer nofollow" href="https://x.com/EricBalchunas/status/1795934675380109479" target="_blank">Analysts</a> have pointed out the substantial amount of money flowing into spot Bitcoin ETFs since they were introduced in January, totaling $13.85 billion.</p>
<p>Spot Ether ETFs are anticipated to attract 10-15% of these funds, which would additionally increase the price of Ether.</p>
<h2 id="strong-3-whale-accumulation-strong"><strong>3. Whale Accumulation</strong></h2>
<p>Another reason for Ethereum’s potential price surge is the accumulation by its richest whales. On-chain data resource Santiment shows that entities holding 10 million to 100 million ETH have increased their holdings by approximately 0.5% since May 20, coinciding with rumors about the U.S. Securities and Exchange Commission’s (SEC) <a href="https://coingape.com/us-sec-to-deny-spot-ethereum-etf-reuters/" rel="noopener noreferrer nofollow">denying</a> spot Ether ETF denials.</p>
<p><img decoding="async" class="aligncenter size-full wp-image-200202" src="https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment.png" alt="Ether supply distribution among whales. " width="3840" height="1300" srcset="https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment.png 3840w, https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment-300x102.png 300w, https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment-1224x414.png 1224w, https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment-768x260.png 768w, https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment-1536x520.png 1536w, https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment-2048x693.png 2048w, https://coingape.com/wp-content/uploads/2024/06/Ether-supply-distribution-among-whales.-SourceSantiment-150x51.png 150w" sizes="(max-width: 3840px) 100vw, 3840px"></p>
<p>This accumulation trend continued even after the SEC approved spot Ether ETFs on May 23, contributing to a 19.25% ETH/USD price boom. Conversely, entities with a balance of 1 million to 10 million ETH have reduced their holdings, indicating profit-taking.</p>
<p>However, the overall reduction in Ether reserves across all crypto exchanges suggests increasing hodling sentiment, which supports the potential for Ether to continue rallying in June above $4,000.</p>
<h2 id="strong-4-lower-structural-sell-pressure-compared-to-bitcoin-strong"><strong>4. Lower Structural Sell Pressure Compared to Bitcoin</strong></h2>
<p>One strong case for Ethereum’s possible price increase is its lower level of “structural sell pressure” in comparison to Bitcoin. Contrary to <a href="https://coingape.com/bitcoin-miners-pace-up-energy-consumption-by-over-61-ahead-of-halving/" rel="noopener noreferrer nofollow">Bitcoin miners</a>, Ethereum validators do not experience the same financial burdens as they do not require selling ETH to cover expenses.</p>
<p>This difference suggests that Ethereum could see a bigger rise in price due to demand than Bitcoin did after the introduction of ETFs.</p>
<h2 id="potential-risks">Potential Risks</h2>
<p>Although Ethereum shows promise, investors must consider potential risks in their evaluation. A possible risk is the impact that Grayscale’s Ethereum Trust (ETHE), managing $11 billion in assets, could have.</p>
<p>If the Ethereum Trust behaves similarly to the Grayscale Bitcoin Trust, with $6.5 billion <a href="https://coingape.com/grayscale-bitcoin-etf-faces-1-6b-outflows-as-bitcoin-halving-nears/" rel="noopener noreferrer nofollow">outflows</a> after approval, it could negatively affect ETH price.</p>
<h2 id="strong-current-eth-price-market-action-strong"><strong>Current ETH Price Market Action</strong></h2>
<p>Ethereum price is currently trading at $3,815.02, having demonstrated a slight increase of 0.51% over the past day. Although the value of the second largest cryptocurrency dropped by 2.62% in the past week, it has experienced resilience and growth in the long term, with an increase of 2.62% and 100.44% over the past month and year respectively.</p>
<h2 id="strong-conclusion-strong"><strong>Conclusion</strong></h2>
<p>The present landscape with Ethereum shows a significant decrease in Ether held by exchanges, an increase in accumulation by whales, and the upcoming launch of spot Ether ETFs. All of these factors indicate the possibility of a price increase. Despite potential risks, the general outlook is optimistic, as numerous analysts forecast Ethereum may achieve new record levels soon. Investors should always remain updated and weigh both the potential benefits and drawbacks prior to making investment choices.</p>
<p>The post <a href="https://coingape.com/blog/top-reasons-eth-price-could-reach-a-new-all-time-high-soon/" rel="noopener noreferrer nofollow">Top Reasons ETH Price Could Reach a New All-Time High Soon</a> appeared first on <a href="https://coingape.com" rel="noopener noreferrer nofollow">CoinGape</a>.</p>

Top Reasons ETH Price Could Reach a New All-Time High Soon

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