Ether’s (ETH) recent market performance is catching the attention of crypto traders and analysts as the cryptoasset outshines its peers with a notable rally. While bitcoin (BTC) reclaimed critical levels, ETH’s strength suggests it may soon challenge its all-time high of $4,868, representing a potential upside of over 35% from current prices.
Ether price surged over 11% in the past week to reach a high of $3,688 on Thursday, outperforming the broader crypto market. Likewise, QCP analysts highlighted in a report that the ETH/BTC ratio climbed by 17.8% last week to reach the 0.03760 mark, signaling robust demand for the Ethereum blockchain native token. Noting that the ratio is a key metric, the firm suggested that a higher ETH/BTC ratio could be on the horizon, which would imply bullish momentum for ETH. Notably, ETH’s strong outperformance comes as BTC reclaimed the $97,000 level on Saturday, following favourable U.S. inflation data.
Technical indicators also point to further growth for the second-largest cryptoasset by market cap. QCP analysts noted that the potential crossover of ETH’s 200-day and 50-day Exponential Moving Averages (EMAs) on its daily chart, could result in a significant ETH price rally.
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Spot Ethereum ETFs Drive Inflows
A significant driver of ETH’s rise has been the surge in inflows into spot Ethereum exchange-traded funds (ETFs). On 27 November 2024, U.S spot ETH ETFs recorded a daily net inflow of over $90 million, with Fidelity Ethereum Fund (FETH) and Grayscale Ethereum Mini Trust (ETH) accounting for an estimated $38 million and $37 million, respectively.
The VanEck Ethereum Trust (ETHV) and Bitwise Ethereum ETF (ETHW) were the other two ETFs to record substantial inflows on Wednesday, boasting daily inflows of $13 million and $1.5 million, respectively. Per SoSoValue data, the cumulative net inflow into these ETFs has increased to a staggering $240 million at the time of writing, reflecting the growing investor interest in ETH as a long-term asset.
Bitcoin Dominance Declines
ETH price rise is also linked to bitcoin’s declining market dominance, which fell from a high of 61.50% last week to 54.2% at the time of writing. Analysts at QCP Capital noted that Bitcoin dominance breaking down has provided ETH room to strengthen. They highlighted that the next significant ETHBTC level to watch is 0.0400, which could serve as a key milestone for ETH in the ongoing market rally.
“ETH/BTC has held up nicely and is currently at 0.03760, up 17.8% from last week. This brings 0.0400 into focus as the next level to watch,” QCP Capital stated in their latest market analysis.
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Decentralized Finance (DeFi) growth contributes
It bears noting that Ethereum’s decentralized finance (DeFi) ecosystem has also seen a resurgence in recent weeks. According to DeFiLlama data, the total value locked (TVL) in Ethereum-based protocols increased by $10 billion this week and is sitting at $70.2 billion at the time of writing. The renewed focus on DeFi further solidifies Ethereum’s position as a leader in blockchain smart contracts innovation.
While ETH has lagged behind BTC and SOL in certain aspects of the ongoing rally, its recent performance indicates the potential for a breakout above it’s all-time high. With its growing DeFi adoption, robust ETF inflows, bullish technical indicators and declining Bitcoin dominance, Ethereum appears well-positioned to challenge its previous all-time high in the coming weeks. At the time of writing, ETH is changing hands at $3,600, gaining over 30% in the past days.
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Ndianabasi Tom A Petroleum Engineering degree holder, Ndianabasi’s interest since 2018 has been studying the ever-growing field of blockchain and cryptocurrency, keenly evaluating the innovation, exploration, and expansion of this field locally and globally. The founder of Nitadel a media platform, Ndianabasi has been a Writer at Crypto Asset Buyer (CAB) since 2021. When he is not drilling resources in the blockchain and cryptocurrency field, Ndianabasi is singing, reading, watching crime movies, or playing football.
