'Ultra Sound Money' Story Fades, But Ethereum's Technical Indicators Signal Strength - Analysts

Recent trends indicate a weakening of Ethereum 's "ultra sound money" narrative as its total supply peaks and its staking ratio has decreased by 1% since November. Despite these supply-side issues, new insights suggest Ethereum could still see potential upward movement in value.

CryptoQuant's recent analysis highlights several important factors. Ethereum's realized price is approximately $2,200, compared to a market price of $2,600.

This realized price signifies the average acquisition cost for ETH holders and acts as a crucial support level. With the Market Value to Realized Value (MVRV) ratio slightly above 1, Ethereum seems significantly undervalued.

The number of long-term Ethereum holders, who accumulate without selling, is rapidly increasing, resembling trends in Bitcoin. Although some large investors, or 'whales,' sold during the recent downturn, these steadfast holders have absorbed much of the selling pressure. In the past week, whales owning between 10,000 and 100,000 ETH have purchased over 600,000 ETH.

Furthermore, selling pressure in Ethereum’s futures market has diminished. The net market price trading volume shows that despite Ethereum's price drop from its $4,000 peak last November, selling volumes are at even lower levels. This suggests a gradual increase in buying interest as prices decrease.

Institutional entities are also significantly increasing their Ethereum holdings. Notably, firms like BlackRock with 100,535 ETH (valued at $276 million), Cumberland (62,381 ETH at $174 million), and World Liberty Financial have continued to acquire Ethereum during the downturn. This large-scale accumulation is crucial in stabilizing the market.

CryptoQuant concludes that while Ethereum continues to face supply-side challenges, such as increasing total supply and declining staking ratio, strong demand factors are evident. Although price fluctuations may persist due to macroeconomic uncertainties, Ethereum's long-term growth potential seems promising.

Despite fluctuating prices, data from Santiment indicates that 9.63 million ETH, equivalent to $26 billion, are currently held in exchange wallets, marking the lowest level since August 2024.

The withdrawal of assets from exchanges typically reflects investor confidence and decreases selling pressure, mitigating the risk of substantial price drops.

Analysts predict that Ethereum’s future trajectory will significantly hinge on Bitcoin's stability and its ability to reclaim its all-time high. CoinShares' recent report highlights Ethereum leading weekly crypto inflows for the first time in 2025, with nearly $800 million in inflows, nearly double the $407 million directed toward Bitcoin-related products.

Disclaimer: The information provided in this article is for educational purposes only and should not be considered financial or legal advice. Always conduct your own research or consult a professional when dealing with cryptocurrency assets.