Ethereum’s Silent Build-Up: A Catalyst for the Next Bull Run?

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• Despite Ethereum’s muted price action, on-chain analysis suggests a potential breakout soon.
• Rising ETH ETF inflows and increased open interest indicate growing investor confidence in Ethereum.
• Ethereum’s lower exchange supply, record staking rates, and significant supply shock position it for potential price appreciation.

Amidst a broader market-wide rally, Ethereum’s performance has been lackluster, leaving many holders disappointed. However, a recent analysis of on-chain data suggests a potential breakout for ETH in the near term.

Market experts highlight key indicators suggesting an imminent price surge. The first is rising ETH ETF inflows: Since November 6th, institutions have poured in 195K ETH worth $663.8 million, helping ETH ETF net inflows turn positive for the first time since its launch. This indicates a growing demand for the token.

Secondly, Ethereum’s open interest, which denotes outstanding derivative contracts, has surpassed its previous record of $13 billion—an increase of over 40% in the past four months. This, combined with positive funding rates, suggests increased optimism among traders.

Like Bitcoin, large investors or whales have been on a buying spree, accumulating over $1.5 billion ETH in the past three weeks. However, the altcoin’s huge supply crunch, unlike BTC’s, makes it a prime candidate for a price surge. This is due to a combination of factors: lower exchange supply, record staking rates, and a significantly lower annual emission rate.

Ethereum’s On-Chain Metrics

Unlike BTC, ETH MVRV Z-Score suggests an imminent price increase for ETH, similar to the one seen in Q4 2020. The Ethereum network itself is experiencing strong growth. Total Value Locked (TVL), fees, active users, and revenue have significantly increased in the last 30 days, while the token supply remains relatively flat.

Hopium Chart: ETH is forming a chart pattern similar to BTC. The only difference is that ETH is lagging BTC by a few months, which is a common occurrence during a bull run. In my opinion, ETH looks primed for a pump toward $4K if BTC doesn’t ruin the rally

While these on-chain indicators paint a bullish picture, the future remains uncertain. However, for Ethereum investors, this analysis provides a glimpse of hope and potential upside in the coming months.