Ethereum is on a massive run, primarily driven by large inflows into Ethereum ETFs and overall market positivity. The second-largest cryptocurrency by market capitalization is surging toward its all-time peak due to a perfect storm of catalysts. Recent developments suggest a bullish outlook for Ethereum, with analysts raising price targets and investors showing increased interest.
ETF Inflows and Supply Dynamics
Ethereum ETFs recently logged record inflows, indicating the continuing bullishness of investors. On August 13, these ETFs experienced inflows of $729 million. During a period of just three days, inflows amounted to $2.2 billion, raising concerns about a possible supply squeeze. This unprecedented increase in demand combined with the withdrawal of almost $60 billion in new issuance is resulting in major structural supply pressure. In monetary terms, monthly inflows are currently 11% higher than post-Merge ETH issuance.
On Monday, that momentum culminated in a historic milestone as Ethereum ETFs attracted more than $1 billion in new investments. This great sum marks the biggest single-day inflow in history. This new flow of capital is one of the main drivers of Ethereum’s rapid price appreciation and positive momentum throughout the market.
Price Performance and Market Sentiment
On a price performance basis, Ethereum has been the strongest of the three, up +29% this week and +54% month-to-date. The crypto market has seen phenomenal gains surging to a total cryptocurrency market cap of $4.13 trillion. This rebound features a 2.8% one-day spike and a striking 11.1% seven-day increase.
ETH’s optimism is really evident right now, especially with the Fear & Greed Index. It jumped up all the way to 63, a phenomenal 3-point leap in less than 24 hours! This development reflects increasing optimism and confidence among investors. On top of that, Ethereum’s explosion has led to a memecoin market that’s now worth more than $82 billion.
Analyst Projections and Market Correlations
As a result, Standard Chartered raised its Ethereum price targets, expecting $7,500 by year-end and $25,000 by 2028. These bullish predictions are a clear indication of the bank’s belief in Ethereum’s long-term prospects.
Bitcoin has decoupled from tech stocks, meaning that crypto-specific factors are now moving the markets. This upgrade could have tremendous implications for Ethereum. The 24-hour crypto-IWM correlation is currently a very high 0.89. This further suggests traders view small caps and crypto as connected risk-on plays, which today are helping to lift Ethereum on this news.
Funding rates have jumped up to 0.0128% a day, a 25% daily increase, helping boost the price of Ethereum. Though not entirely Ethereum-related, perpetuals open interest has shot up by 13% to $825 billion, showing increasing interest across the entire crypto market.
