Ethereum’s price has been stuck in neutral lately, but is that the whole story? A recent analysis suggests there’s more to the picture than meets the eye.
Undervalued Ethereum?
The analysis points to Ethereum potentially being undervalued. The realized price—the average cost of all ETH held—is around $2,200. With the current market price hovering around $2,600, it suggests ETH is cheaper than its actual cost basis. This could act as a solid support level, preventing further price drops.
Long-Term Holders are Buying the Dip
Another positive sign? Long-term Ethereum holders are accumulating more ETH without selling. This is similar to what we’ve seen with Bitcoin’s “hodlers.” Even though some big investors sold during recent dips, these long-term holders absorbed the extra supply, keeping the market stable. This suggests a maturing investor base, confident in Ethereum’s future.
Less Selling Pressure, More Institutional Interest
The selling pressure in the futures market has also eased significantly. This, coupled with a reduction in sell-side trading volume, indicates increased buying power. This could be a precursor to a price rebound if the overall market improves.
Adding to the positive outlook, major institutional investors like BlackRock and Cumberland have been buying up large amounts of ETH. BlackRock’s reported purchase of over 100,000 ETH is a strong signal of confidence.
Challenges Remain
Despite the positive signs, some challenges remain. The increase in total ETH supply and a slight drop in the staking ratio could dampen enthusiasm, especially if the overall economy remains uncertain. Short-term price movements might also be limited while the market reacts to ongoing economic changes.
The Bottom Line
While Ethereum’s price might stay flat for a while, the combination of undervaluation, strong long-term holder activity, reduced selling pressure, and significant institutional investment paints a positive picture for the medium to long term. Once the broader market stabilizes, Ethereum could be poised for growth.
