Ethereum Blasts Past $3,000 As Plenty of Bullish Triggers Emerge
The second most popular cryptocurrency, Ethereum, has spiked past the $3,000 price level for the first time since January, pushed by a bunch of positive catalysts, including ETH burns, ETF accumulation, and the significant Bitcoin rally.
After the $3,000 peak in January, Ethereum bottomed below $1,500 in April and then gradually rose back, trading in the $2,500 range for several months. Now, it has broken back above $3,000, reflecting Bitcoin’s own positive momentum as the crypto market is again riding a powerful bullish wave.
Key Reasons Behind Ethereum Surge
The Ethereum burn mechanism was integrated in 2021 with the EIP-1559 upgrade, and since then, it has been continuously used for reducing the circulating ETH supply. By now, the ETH community has already disposed of 5,315,047.4 ETH – this is the equivalent of $17,452,740,428, according to data provided by Beaconcha. Over the past week alone, roughly 2 ETH per minute got incinerated, putting significant deflationary pressure on Ethereum.
While Ethereum’s supply is unlimited, unlike that of Bitcoin, the burn mechanism integrated by the Ethereum team, as well as post-Merge changes, have managed to reduce the ETH network’s inflation substantially, especially during the periods when the transaction volume goes up.
The Pectra upgrade, which took place in May, brought certain improvements to the network, such as reducing gas fees and improving the transaction throughput, which improved the overall usability of Ethereum, making it more attractive to developers and users. This caused a large increase in its on-chain activity, strengthening ETH’s value proposition as an active blockchain and asset for DeFi, NFTs, and dApps.
Another big reason for Ethereum’s price surge was the recent rally of the king crypto, Bitcoin. Over the past week, BTC has first surged past $119,000, setting a new all-time high and then, earlier this week, surpassing the $123,000 level for the first time ever in its 16-year existence. A correlation between Bitcoin and the top ten cryptocurrencies remains quite strong during bull markets.
When market sentiment improves, investors tend to switch from Bitcoin to Ethereum and other large-cap altcoins. This is what happened this time, and institutional accumulation has increased largely.
ETFs and Trump’s World Liberty Finance Accumulating ETH
A large contribution to the fresh Ethereum rally has been made by a surprising spike in institutional accumulation of ETH. Spot Ethereum ETFs have been gradually scooping up ETH from the market circulation. Even though their inflows have been significantly smaller than what Bitcoin ETFs bought, the amount of institutional inflows into Ethereum ETFs has surged to a large extent. These purchases have been putting additional buying pressure on the second-largest cryptocurrency.
On July 16, Ethereum ETFs inhaled 79,674 ETH worth $256.55 million, with BlackRock remaining the leader as it received the largest portion of this ETH, 55,984 ETH (valued at $180.27 million). Currently, it holds 2,153,300 ETH, equal to $6.93 billion.
A day earlier, Ethereum ETFs saw inflows of 80,294 ETH worth $245.06 million. BlackRock again got the biggest piece of the pie – 50,538 ETH ($154.24 million).
Among the major institutional buyers has been World Liberty Finance (WLFI) – a crypto investment fund associated with the current US president, Donald Trump. Lookonchain revealed that a wallet connected to this venture bought 1,531 ETH for 5 million USDC $3,266 per coin on July 16. Before that, WLFI made other significant Ethereum acquisitions. According to various sources, Trump’s crypto fund currently holds approximately 63,000 ETH, displaying a long-term bet and strategic accumulation rather than a short-term profit-taking pattern.
ETH to Reach $4,000?
In the meantime, the Ethereum Foundation has been spotted moving millions worth of ETH again this month. According to several on-chain sources on X, the Foundation has moved more than $2 million in ETH to an unknown wallet. These movements regularly cause concerns about possible upcoming sell-offs, especially on the wave of the current Ethereum price increase. However, no evidence has been provided that this ETH was actually transferred to crypto exchanges. More likely, these regular transactions targeted a multisig cold-storage wallet.
All the aforementioned Ethereum bull run triggers are likely to continue to persist in the near term w,hich means they may boost the rally way beyond the $3,000 level. As this resistance has been turned into support, investors have regained confidence in ETH’s long-term potential as an asset, especially among layer-1 chains. Should ETH manage to stay above $3,000 without bouncing back, the rally is likely to extend higher and hit $4,000, per multiple analysts. Currently, ETH is trading at $3,300.
