Is Ether (ETH) $4K still on the cards?

Several base-layer blockchain cryptocurrencies that compete with Ethereum, because they are optimized for smart contracts and open source currency issuance, rose more on their price charts than ETH during the US election rally. Even Bitcoin’s gains outpaced Ether’s in this turn of the markets.

In the 30 days ending Friday, November 22, the price of Bitcoin gained 47%. Meanwhile, Sui Coin (SUI) rose 74%, Solana 56% and Polkdadot (DOT) rose 44%, according to data compiled by TradingView. Ether did not outperform these DeFi competitors with a 25% increase during the period.

Although the price of Ether on crypto exchanges hit $3,450 on Saturday, some investors are nervous about its prospects of reaching the $4,000 level at the peak of this crypto macrocycle.

In addition to concerns about the ethereum platform’s mutable and overcrowded code base and byzantine architecture, some analysts have expressed low concerns about the fundamentals of the Ether economy.

Here is one of the biggest tragedies of crypto:

Bitcoin, the most stable chain for long-term financial services, does not have the technical resources to provide them.

Ethereum, a chain with the technology to do this, is too mutable and complicated for anything other than gaming.

BOS solves this. pic.twitter.com/9xPyLgHDER

— Yago (@EdanYago) November 22, 2024

Amberdata’s director of derivatives Greg Magadini, for example, said in a note to clients that “ETH faces serious headwinds as the ‘hard money’ value proposition has shifted to the ‘supply inflation as almost all DeFi transactions are being executed in L2s… I think this is dramatically dragging prices down.’

While ETH became a deflationary currency on September 15, 2022, deflation has slowed in 2024 with the proliferation of the coin in Ethereum Layer-2 services. Although it hasn’t really slowed down much on the multi-year time scale.

1. Bullish: The ETH/BTC ratio is turning again

Here’s how ETH has compared to BTC so far in 2024.

Legendary commodity and forex trader Peter Brandt pointed out to followers on Wednesday that the price relationship between BTC and ETH is at a cyclical turning point, where it has formed a bottom in past cycles. This means that Ether prices may rise soon, even compared to BTC.

A letter from the grave???? $ETHBTC pic.twitter.com/FALauZ8M7R

— Peter Brandt (@PeterLBrandt) November 21, 2024

“A letter from the grave?” Brandt wrote in a note on X. The veteran commodity trader posted a chart of Ethereum’s price-to-Bitcoin ratio from TradingView that shows how this metric melted the chart the last time it was this low in this time in BTC’s 4-year supply cycle.

These are bullish technicals for Ethereum as the cryptocurrency markets around the calendar until 2025.

2. Ethereum price prediction: $6,000 in 2025

Crypto chart analyst Ali Martinez predicts that Ether will overtake Bitcoin on the chart at the end of this market macro cycle. It marks $6,000 as the highest price in its most bullish scenario for Ether in the coming months. Martinez expects at least $4,000 for Ethereum this cycle.

#Ethereum $ETH is about to surpass it #Bitcoin $BTC!

And here I show you the price targets

— Ali (@ali_charts) November 19, 2024

“Every market cycle has seen a phase where #Ethereum outperforms Bitcoin,” Martinez began in a note to followers on Tuesday X. “This has yet to happen in the current cycle, but it’s certainly on the horizon. As ETH lags behind, here is an opportunity to buy before it outperforms.”

“Smart investors are aware of this and there has been a significant shift in spot Ethereum ETFs,” Martinez wrote, showing a chart of spot Ethereum ETF inflows from August to 18 of November “They went from distribution to hoarding, having surprised over $147 million in ETH.”

period #Ethereum $ETH ETFs have seen a substantial turnaround over the past two weeks, with cumulative total net inflows now exceeding $147 million. pic.twitter.com/mAYU1Bid2V

— Ali (@ali_charts) November 19, 2024

In another chart, Martinez showed a long-term ascending parallel channel from July 2022, which, if continued, could see Ethereum price above $5,000 in April 2025.

In addition to rising ETF volume, open interest in Ethereum futures on the Chicago Board Options Exchange also changed over the same time period.

CBOE Ether futures volume and open interest rose from 3,613 and 6,121, respectively, on Oct. 11 to 16,614 and 13,043 on Nov. 21, according to CME Group data.

3. DApp volume increases by 38% in one month

Another fundamental analysis of the price of Ethereum, in addition to its inflation rate against the US dollar, is the monthly active use of Web3 or decentralized applications protected by its blockchain network.

Dapp volumes for Ethereum are increasing along with ETH/BTC reaching a historical inflection point and ETF investor sentiment turning bullish, and during the same calendar period that Ether futures volume is increasing and ETF inflows, according to data from DApp Radar.

Ethereum DApp volume for the 30-day period ending November 20 was first in its class among DeFi coins. With $150 billion in volume in its decentralized application layer, Ethereum outperformed Arbitrum (ARB) in second place with $32 billion and Binance Coin (BNB) in third place with ($26 billion).

4. ETH vs. SUN Do-Si-Do Nov. ’24

We’ll add up the percentage of each base layer coin’s earnings over a relevant period in November and their top three meme tokens and/or L2 utilities, you know if you have a preference.

Over the period of several years, Solana went on a strong bull run while Ethereum was in hibernation. This could mean that there is more upside in the Ethereum market in the next turn of the cycle.

The relative performance of base layer ETH tokens, the three most popular Ethereum meme coins, against SOL tokens and the three most popular Solana memes during the US election rally is another sign of a paradigm shift in the markets of ‘these competing altcoins.

SOL outperformed ETH for the 30 days ending November 22nd. Ethereum climbed the chart by 25%, while Solana racked up gains of 53%. Still, the top three Ethereum meme coins outperformed Solana memes overall during the same period.

The 30-day cumulative ROI for Ethereum plus its top three memes was 220%, while Solana’s ROI plus its top three memes was 200%.

This higher percentage gain is good for the individual altcoin trader who had the Ethereum coins in their wallet during this time, but how difficult was it for the market to move these economies by these percentages? It depends on several factors, but market capitalization is a central indicator of their confluence.

The collective market caps of these Ethereum and Solana economies on November 22nd were $423 billion and $129 billion, respectively. Therefore, the additional value of 21% ROI accumulated on Ethereum coins is more impressive than that of Solana because it is more difficult to move the ETH market cap.

Also, there are those ETH fees, as SOL boosters would be apt to point out.

5. Institutional support for Ethereum

In addition to the upward shift in Ethereum ETF monthly net inflows and Ether futures volume in November, institutional investors show a high level of conviction for ETH in the percentage of their coins that they maintain that they stay in bets to secure the net and get returns in addition to winnings. in market prices on cryptocurrency exchanges.

Institutional investors are really interested in investing in Ethereum, not just holding Ether, but locking it in stake contracts to ensure the performance of the platform economy. This demonstrates a high level of conviction in the product and its long-term growth prospects.

In early October, Carlos Mercado, a data scientist at blockchain strategy firm Flipside Crypto, noted that the number of Ethereum adopters had increased by more than 30% over the past 12 months . That number hit the million mark for the first time in June.

A recent survey of Ethereum users by Blockworks Research, a New York City-based blockchain intelligence firm, was published in mid-October. 30, found that 69.2% of respondents hold Ethereum, but 78.8% of investment firms or asset managers own a stake in ETH.

Additionally, they are taking extra steps to keep their Ether more liquid as they stake it, with over 52% reporting that they use a liquid token. This shows a level of sophistication for these traditional financial participants in the crypto smart contract economy.

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