Ethereum has seen a significant rally in recent weeks, with its price surging by over 50% in a month and more than 150% since the April lows. According to Matt Hougan, Chief Investment Officer at Bitwise, this growth can be attributed to what he described as a “demand shock”, primarily driven by institutional flows and exchange-traded products (ETPs).
Hougan explained that since mid-May, Ethereum-based investment vehicles have absorbed over $5 billion in capital inflows. Major corporate treasuries and crypto firms, including Bitmine and SharpLink, acquired a total of 2.83 million ETH, amounting to approximately $10 billion. During the same period, only 88,000 ETH were issued by the network.
Market Dynamics Favor Supply-Demand Imbalance
This disproportion between issuance and buying activity led to a sharp appreciation in Ethereum’s value, pushing it to a new annual high of $3,848 on July 21.
Hougan forecasted that this crypro trend is likely to persist, citing continued underallocation to Ethereum by ETP investors compared to Bitcoin. The fact that Bitmine and SharpLink stocks are trading at a premium relative to the value of their crypto holdings is encouraging similar behavior from other market participants.
In Hougan’s view, companies that have yet to enter the Ethereum market may soon follow suit. He predicts that within the next year, these firms could collectively purchase an additional 5.33 million ETH - roughly $20 billion at current prices.
Meanwhile, Ethereum’s estimated issuance for the same timeframe stands at just 800,000 ETH. This suggests that demand may outpace supply by a factor of seven. Hougan acknowledged that Ethereum differs from Bitcoin in that its supply is not hard-capped, but emphasized that in the short term, market price will be dictated by demand rather than issuance mechanics.
BitMEX Co-Founder Sees ETH at $10,000 by Year-End
Further optimism comes from BitMEX co-founder Arthur Hayes, who issued a bold forecast that Ethereum could reach $10,000 by the end of 2025. Hayes tied this expectation to macroeconomic and political factors, particularly policy decisions from a potential second Trump administration.
According to Hayes, the expansionary credit programs anticipated under Trump’s leadership are likely to increase the money supply and provide support for asset markets, including digital currencies. He also cited recent developments such as the signing of stablecoin legislation and initiatives to enable retirement fund access to crypto assets.
Hayes observed a significant shift in sentiment among Western institutional investors, who have started to view Ethereum as a core asset within the crypto market. He referenced Ethereum’s undervaluation relative to Solana’s recovery as a key narrative shift, noting that “Ethereum is now the most underpriced large-cap crypto asset, but that is changing fast.”
He concluded that institutional capital is flowing rapidly into Ethereum and expects buying to continue with little hesitation.
Expert Opinions Remain Divided on Market Outlook
At the time of writing, Ethereum is trading at $3,667. While some analysts believe the asset still has room for upside, others urge caution. Tom Lee, Head of Research at Fundstrat and Chairman of Bitmine, recently shared a crypto prediction that Ethereum could reach $15,000, citing increasing institutional engagement and network growth.
Conversely, CryptoQuant contributor known as Crypto Dan has downplayed concerns about overheating. He emphasized that any price correction, if it occurs, is likely to be short-lived and moderate in scale.
The ongoing demand from corporate treasuries, combined with expanding ETP access and favorable macroeconomic conditions, suggests that Ethereum’s momentum may persist in the months ahead. Analysts and investors alike continue to monitor these developments closely, with many watching for signals that could predict the next leg of the bull cycle.
Let me know if you’d like this version localized, shortened for newsletter format, or adapted to fit SEO requirements.
