Ethereum Price Hits $4,420 Amid Growing Demand
Ethereum (ETH) retested resistance near $4,500 on Thursday. A report from Sygnum Bank says strong buying from ETFs and corporate treasuries may cause a supply squeeze. This means demand could soon outpace available ETH.
Supply Crunch Driven by Pectra Upgrade and Regulation
Sygnum Bank’s report on September 9 highlights rising demand for Ethereum. The report notes that ETH reserves on exchanges are at cycle lows. Meanwhile, ETFs and corporate buyers are accumulating more ETH.
Since the Pectra upgrade in early May, Ethereum has risen 140%. This outperforms Bitcoin’s 15% and Solana’s 42% gains. The upgrade improved staking and scalability. Positive crypto regulations, like the GENIUS and CLARITY Acts, also helped boost demand.
- US spot Ethereum ETFs saw $10.3 billion in net inflows since May.
- Corporate treasuries acquired nearly $16 billion worth of ETH.
- Whales holding 10,000 to 100,000 ETH added 5.6 million ETH.
The SEC clarified that liquid staking is not a securities offering. This encourages more institutional investors to join. Staking yields attract buyers seeking passive income.
ETH reserves on exchanges keep shrinking as more ETH moves to staking protocols. These protocols now hold nearly 30% of Ethereum’s supply. The report expects deposits to continue as ETF staking approval looks more likely.
Recent validator exits are due to investors rebalancing staked ETH, not selling for profit. Many used looped staking strategies that became unprofitable when borrowing costs rose above staking yields.
Ethereum Technicals Show Mild Bullish Signs
Ethereum saw $71.8 million in futures liquidations in the last 24 hours. This included $38.1 million in long and $33.7 million in short liquidations, according to Coinglass.
ETH broke above a descending triangle pattern and retested $4,500 resistance. To start a rally toward its all-time high near $4,956, ETH must hold $4,500 as support.
Technical indicators support a possible uptrend. The Stochastic Oscillator rose above its neutral level for the first time this month. The Relative Strength Index (RSI) also crossed above its moving average.
On the downside, ETH may find support near the 50-day Simple Moving Average (SMA) and the $4,000 psychological level. Falling below these could push ETH toward $3,500.
