Ethereum’s ‘Ultra Sound Money’ Narrative Fades, But Key Metrics Signal Growth Potential
Ethereum’s actual price indicates undervaluation however, institutional investors and decreased selling pressure imply increased confidence in the altcoin.
Ethereum’s ‘super sound money’ narrative has weakened recently, as its total supply has reached an all-time high and the staking ratio has fallen by 1% since November.
Despite these negative supply-side conditions, recent research reveals that ETH still has a high growth potential.
Ethereum’s Market Outlook
First, Ethereum’s realized price is at about $2,200, which is significantly lower than its market value of $2,600. This statistic represents the average acquisition cost for all ETH holders and serves as an important support level. With MVRV calculated using the realized price slightly higher than one, Ethereum appears to be significantly undervalued.
Additionally, the number of long-term Ethereum investors who have accumulated but never sold is rapidly increasing, mirroring a trend seen in Bitcoin. Although some whale investors may have fled during the current slump, it appears that these long-term holdings have weathered the selloff. A group of whales with 10,000 to 100,000 ETH purchased over 600,000 ETH in the last week alone.
Another important point is that Ethereum’s futures market is seeing less selling pressure. The net market price trading volume chart shows that while Ethereum’s price has fallen since its $4K peak in November, selling volume has fallen much further. This means that, as prices have fallen, buying interest is steadily increasing.
On top of that, prominent institutions are aggressively growing their Ethereum holdings. Companies such as BlackRock (100,535 ETH worth about $276 million), Cumberland (62,381 ETH worth $174 million), and Donald Trump’s World Liberty Financial (WLFI) have continued to acquire despite the decline. This large-scale accumulation is crucial for market stability.
As a result, CryptoQuant determined that, while the leading altcoin is now suffering supply-side problems such as increased total supply and a decreased staking ratio, significant demand forces remain in play. While price movement may be flat for a few months due to macroeconomic uncertainty, Ethereum’s long-term promise remains intact.
Exchange Reserves Decline
Despite the erratic price activity, Sentiment data show that 9.63 million ETH, worth $26 billion, are presently kept in exchange wallets. This is the lowest figure since August 2024. Typically, when investors withdraw assets from exchanges, it shows confidence and lessens selling pressure, lessening the danger of significant price reductions.
Analysts also believe Ethereum’s future trajectory will largely depend on Bitcoin’s stability and ability to reclaim its all-time high. Besides, CoinShares recently reported that Ethereum led weekly crypto inflows for the first time in 2025 as it attracted nearly $800 million, nearly double the $407 million that flowed into Bitcoin-related products.
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