Ethereum is on the rise, showing historic gains that attract both investors and analysts.
Reasons for Ethereum's Rise
Since July 1, Ethereum (ETH) has gained over 70%, recovering from a sharp decline and liquidating billions of dollars in short positions. The increase was driven by a massive rise in net short positions, which reached record highs, triggering a wave of forced liquidations as ETH began its ascent.
According to The Kobeissi Letter, a further 10% price increase for ETH could result in an additional $1 billion in short liquidations, fueling prices even higher.
Who's Buying Ethereum?
Institutional purchases are significantly contributing to Ethereum's current rise. For instance, World Liberty Financial, linked to President Trump, bought $5 million worth of ETH just a day before Kobeissi's post went viral. Furthermore, BlackRock’s Ethereum ETF has been accumulating ETH for 29 out of the past 30 days, ahead of retail investor involvement. These actions indicate that institutional investors may have anticipated the impending short squeeze.
Ethereum's Prospects and Crypto Legislation Impact
Among the factors driving Ethereum's growth are the upcoming changes in U.S. legislation. In July, the U.S. Congress passed several bills, such as the Clarity Act and the Genius Act, which creates confidence for long-term institutional involvement. One of the most explosive catalysts could be President Trump's expected executive order allowing $8.7 trillion retirement plans to invest in cryptocurrencies. This would enable regulated retirement funds to directly allocate to crypto assets like Ethereum and Bitcoin.
Ethereum continues to demonstrate growth momentum, and its potential for further increases should be considered against the backdrop of institutional investments and new legislative initiatives.
