Ethereum Price Prediction: ETH eyes $3,000 as network activity explodes and scarcity grows

  • Ethereum price has just hit a new all-time high at $1,475 and aims higher.
  • Most on-chain metrics have turned bullish for ETH despite rising prices.

Ethereum has finally hit a clear new all-time high across all exchanges, and it’s currently under a healthy consolidation period. Over the past week, Ethereum’s dominance over the market increased from 13% to 17%, while Bitcoin lost close to five percentage points. 

Ethereum price gears up for $3,000 as most indicators turn bullish

The Eth2 deposit contract continues to receive more Ethereum. At the time of writing, it holds around 2.83 million ETH worth over $4 billion at current prices. This is a significant number of Ethereum coins that are locked and cannot be sold. 

eth price

ETH coins locked

In addition to the 2.83 million ETH locked inside Eth2, there are also 7 million ETH locked across DeFi protocols and projects, which means close to 10 million ETH are currently not truly in circulation, increasing its scarcity significantly, and therefore, bullish pressure.

eth price

ETH Transactions chart

One of the main strengths of Ethereum during this run has been a massive increase in the number of transactions in the past several months. The digital asset has reached a 7-day average of 1.15 million transactions, which is almost higher than its peak of transactions in January 2018. 

eth price

Ethereum exchange Netflow

On January 22, 2021, Ethereum saw a colossal spike in the number of coins withdrawn from exchanges. Around 659,000 ETH left exchanges in just a single hour, which is the largest amount ever and indicates traders and investors are not interested in selling the digital asset currently. 

eth price

Ethereum supply on exchanges chart

Although this kind of spikes is not common, the total number of ETH inside exchanges has been declining since March 2020, from a high of 27% of Ethereum to only 20.8% currently, a notable decay. This is a key aspect that should allow Ethereum price to continue rising as demand quickly outpaces supply scarcity. 

eth price

Total Value Locked chart

The DeFi industry has seen a tremendous surge of money in the past few weeks, from $15.4 billion on December 31, 2020, to a current all-time high of $26.5 billion. Considering that around 90% of all DeFi projects are built on Ethereum, this metric shows how fast the ecosystem is growing, and it’s undoubtedly bullish for ETH. 

eth price

ETH/USD 4-hour chart

However, despite all the positive indicators and on-chain metrics in favor of Ethereum, the TD Sequential indicator has presented a sell signal on the 4-hour chart, which, in the past, has proven to be a reliable call. This could mean that Ethereum price is poised for a short-term pullback before resuming its uptrend. 

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Cryptos feed

Latest Crypto News

Latest Crypto News & Analysis

Editors’ Picks

Bitcoin continues to range higher, but altcoins suffer

Bitcoin price has been on a tear lately, but Ethereum and Ripple have failed to perform as fear plagues the cryptocurrency markets. As a result, altcoins are down in the dumps with their dull rallies.

More Bitcoin News

MATIC price eyes 22% advance after dYdX lists Polygon

MATIC price has seen a massive bull rally over the past week. The recent listing of MATIC-USD perpetual on the dYdX platform and other developments might push Polygon on another leg-up.

More Polygon News

SafeMoon price awaits 20% bounce after SAFEMOON surges on Dogecoin SpaceX involvement

SafeMoon price has broken out of a parallel channel that has sealed the asset in consolidation since May 25. The rise in SAFEMOON has been propelled by CEO John Karony after he revealed a significant involvement in the cryptocurrency space.

More SafeMoon News

Dogecoin positions itself for rally that may never come

Dogecoin price appears to be bullish and shows signs of a potential new uptrend. However, this upswing needs confirmation, which will arrive after DOGE produces a decisive close at a critical resistance level.

More Dogecoin News


Bitcoin Weekly Forecast: Markets revert to mean, but BTC price remains indecisive

Bitcoin price shows considerable strength after springing from the recent crashes. Still, it is uncertain whether the current bullish impulse will morph into a new uptrend or lead to a more profound decline.

Read the weekly forecast