In the past 24 hours, the total cryptocurrency market capitalization surged by over 2 percent, reaching approximately $2.3 trillion. Ethereum (ETH) spearheaded this upward momentum among altcoins, with an impressive gain of over 5 percent. The large-cap altcoin, boasting a fully diluted valuation of about $306 billion and a daily average traded volume of around $19 billion, traded around $2,545 on Friday during the early European session.
This significant price jump in Ethereum led to the liquidation of over $28 million from the ETH derivatives market, predominantly affecting short traders.
Forces Behind Ethereum Price Gain Today
Rising Demand from Whales
Whale activity has played a crucial role in Ethereum’s recent price surge. Notably, a whale purchased 2,117.7 ETH, equivalent to $5.17 million, after the price of ETH rose. This whale continued to go long on Ethereum through a strategy known as circular borrowing. Despite experiencing a substantial loss of $13 million over the past six months by going long on ETH, the whale remained optimistic.
Over the past three weeks, on-chain data revealed that more than 547,000 Ether, worth over $1.26 billion, was deposited into various crypto exchanges. This influx occurred despite the poor performance of US spot Ether ETFs, which had contributed to a bearish outlook for Ethereum. However, whale behavior started to shift in the past two days, with BlackRock’s ETHA leading the US spot ETH ETFs in cash inflows, amounting to approximately $5.24 million on Thursday. Remarkably, none of the US spot Ether ETFs recorded a net cash outflow on the same day.
Bullish Crypto Outlook
The cryptocurrency market has exhibited bullish momentum in recent days, driven by the Federal Reserve’s shift to a quantitative easing phase, marked by a 5 basis points rate cut on Wednesday. Bitcoin has led the altcoin market into a bullish trend, teasing above $64,000 earlier today as the Bank of Japan maintained its interest rates at 0.25 percent.
From a technical analysis perspective, Ethereum’s price is likely to continue its upward trajectory, potentially outperforming Bitcoin amid ongoing crypto cash rotation favoring altcoins. Additionally, the ETH/BTC pair has significantly rebounded after hitting a multi-year low earlier this month.
As the cryptocurrency market continues to evolve, investors and traders should closely monitor whale activity and macroeconomic factors influencing the overall market trend. Ethereum’s recent price surge and the bullish outlook for cryptocurrencies underscore the dynamic and rapidly changing nature of the digital asset landscape.
