In July, Ethereum demonstrated impressive growth, rising by 56%, driven by record investments in ETFs. However, this rise invites questions about the sustainability of its fundamental indicators.
Record Inflows: Ethereum Soars Upwards
In July, Ethereum jumped 56%, reaching a peak of $3,862. This is the first time since 2022 that the cryptocurrency has posted a monthly gain of over 50%. This rally was fueled by unprecedented inflows in the ETF market, with over $5.37 billion in net inflows recorded over 19 days.
Ethereum Outpaces Bitcoin: A New Crypto Leader?
According to Eric Balchunas, senior ETF analyst at Bloomberg, this rally is repositioning Ethereum in institutional narratives. Unlike Bitcoin, often regarded as digital gold, ETH is starting to be viewed more like a 90s growth tech stock. This suggests that Ethereum could become a speculative vehicle for mass blockchain adoption.
Weak Fundamentals: Should We Trust the Current Ethereum Rally?
However, not everyone shares this optimism. Markus Thielen, CEO of 10x Research, warns that Ethereum’s network revenue grew by only 3% in July, while on-chain activity increased by just 5%. These modest figures contrast starkly with the market exuberance.
Thus, while Ethereum is experiencing a current surge in interest from institutional investors, it faces notable questions regarding its sustainability and fundamental indicators, which may influence its future.
