Ethereum Price Surge Predicted as Demand and Activity Increase
Ethereum (ETH), the second-largest cryptocurrency by market capitalization, is experiencing momentum, with experts suggesting a potential price surge above $5,000.
A report from The Block by analytics firm CryptoQuant indicates strong price appreciation for Ethereum due to three factors: robust on-chain activity, rising institutional demand, and deflationary token dynamics. These indicators suggest sustained growth potential for ETH.
Network Activity at Record Highs
CryptoQuant reports explosive growth in Ethereum’s network activity through 2024. Daily transactions have surged to between 6.5 to 7.5 million, up from an average of 5 million in 2023. Decentralized application (dApp) usage, measured by contract calls, has also increased to 6 to 7 million daily.
This heightened activity has raised transaction fees, leading to more ETH being burned under Ethereum’s fee-burning mechanism. In September, the burn rate began to exceed new ETH issuance, creating deflationary pressure that limits supply growth.
CryptoQuant analysts use realized price bands to project Ethereum’s future value, currently showing an upper limit at $5,200, similar to Ethereum's peak in the 2021 bull run. As new investors enter at higher price points, this upper band may rise further, indicating additional upward movement potential.
Institutional Interest Fuels Optimism
In addition to on-chain metrics, institutional interest in Ethereum is stronger than ever. Spot Ethereum exchange-traded funds (ETFs), including those from BlackRock and Fidelity, have seen record inflows. Over the past 13 days, ETH ETFs accumulated nearly $2 billion, bringing total assets to $13.18 billion.
This surge in ETH ETF flows reflects growing institutional confidence in Ethereum as a strategic investment vehicle. Additionally, the rising ETH/BTC ratio suggests investors may be shifting from Bitcoin to Ethereum as a preferred investment choice.
Ethereum (ETH) Price Surges
Ethereum's price has risen 4.69% in the past 24 hours, compared to Bitcoin's 1.40% increase, according to market data from Coinspeaker. This disparity may be linked to increased trading volumes and renewed optimism in the broader crypto market.