Here are 5 reasons why Ethereum looks strong despite market volatility

Ethereum is even struggling to reach its March high of $4,000, let alone its all-time high of $4,891 in November 2021.

While Ethereum (ETH)’s on-chain movements and decentralized finance sector remain strong, the leading altcoin is seeing high price volatility amid market turbulence.

ETH briefly touched a four-month high of $3,444 on Tuesday, November 12. Following the price decline from its local highs, the king altcoin has consolidated between $3,120 and $3,290 over the past two days.

ETH price | Source: crypto.news

While Ethereum is still down 34% from its ATH, its fundamentals remain strong.

ETF entries

Spot ETH exchange-traded funds in the US have been recording consecutive inflows since last week’s US election.

Investment products started the week with record net inflows of $295.5 million, led by Fidelity’s FETH and BlackRock’s ETHA funds valued at $115.5 million and $101.1 million, respectively.

On Wednesday, net inflows into spot ETH ETFs were $146.9 million, bringing total inflows to $241.7 million.

These ETH-based investment products saw strong demand for the first time since their launch in July.

whale accumulation

Ethereum is also seeing whale accumulation increase as market participants navigate greedy conditions.

According to data provided by IntoTheBlock, major holders saw net inflows of over 97,000 ETH yesterday, worth approximately $310 million.

ETH whale net flow | Source: IntoTheBlock

Whale accumulation often triggers fear of missing out among retail investors. This often leads to high price volatility before gaining steady upward momentum.

foreign exchange outflows

Besides whales, retail investors are also busy accumulating Ethereum.

According to data from ITB, ETH recorded a net outflow of $1.12 billion last week. The large holder-exchange net flow ratio indicates strong retail accumulation on November 9, 11 and 12.

Net flow from ETH large holder to exchange | Source: IntoTheBlock

Foreign exchange outflows often lead to long-term retention, which ultimately paves the way for stable growth.

DeFi growth

Ethereum’s DeFi sector is also on the rise.

According to data provided by Defi Llama, the total value locked in Ethereum-based protocols increased by approximately $10 billion after the crypto market gained upward momentum with Donald Trump winning the US presidential election.

Moreover, the total fees collected by DeFi platforms on the Ethereum network have tripled in the last seven days, reaching $18 million. These protocols generated a total of $15.5 million in revenue last day.

Will you reach $4k before 2025?

Market analysis firm Amberdata claims that there is an 18% chance that Ethereum will reach the $4,000 level by the end of the year.

18% chance of Ethereum reaching $4000k by EOY pricing ending December 27

We are still a long way from ETH’s all-time high. This makes us think that we may have somewhere to escape. NFA

New SVI Calibrated PDF/CDF graphics created by AD Derivatives @genesisvol
Check out… pic.twitter.com/csb7AZyeCy

— Amberdata (@Amberdataio) 12 November 2024

“We are still a long way from ETH’s all-time high. “This makes us think we might have somewhere to escape.”

Amberdata wrote in an X post.

Strong growth in ETH ETFs and increasing whale accumulation may contribute to the positive momentum of Ethereum price.

However, it is important to note that despite bullish signals on the chain, macro events can potentially shift the market’s focus to the other side.