The recent price rise of Ethereum is attributed to short position liquidations and active investor interest.
Short Position Liquidations Propel ETH Prices Higher
Ethereum has seen a significant price increase, surpassing the $3,600 mark due to the liquidation of short positions valued at approximately $136 million within the last 24 hours. Data from derivatives exchange Derive indicates increased investor activity in acquiring call options with a $4,000 strike price, expiring on July 25. Dr. Sean Dawson, research director at Derive, views this price fluctuation as a signal of a trend change.
Regulatory Support and Institutional Interest Strengthen the Rally
Recent developments in the U.S. Congress, including the advancement of the GENIUS Act regarding cryptocurrency regulations, have increased expectations for a regulatory framework. This has led to the market capitalization reaching $4 trillion for the first time. On that same day, SoSoValue reported that spot Bitcoin ETFs saw inflows of $523 million, while Ethereum ETFs received a net inflow of $602 million.
Future of Ethereum and Predictions
Analyst Valentin Fournier from BRN noted that while the market shows signs of heating up, institutional inflows remain supportive of the main trend. The Crypto Fear and Greed Index currently stands at 71 out of 100. Predictions of Ethereum reaching $5,000 by the end of 2025 have risen to a 27% likelihood.
The rapid rise of Ethereum amid short position liquidations and heightened institutional interest highlights the changing dynamics of the cryptocurrency market.
