Investor interest in Ethereum exchange-traded funds (ETFs) has also surged after inflows hit a six-week high on Nov. 6. Tether’s transfer of $2 billion in USDT to Ethereum could very likely also boost the positive sentiment surrounding the altcoin. Meanwhile, other alts like Trump-themed meme coins surprisingly plummeted after his election victory, though other major meme coins like Dogecoin and Shiba Inu experienced gains.
Ethereum’s Price on Track for Major Gains
Ethereum’s (ETH) strong upward momentum is catching the attention of many analysts after its price rose by close to 25% since the beginning of 2024. The recent boost in ETH’s value is especially notable because Bitcoin (BTC) recently surpassed its all-time high. As a result of this, anticipation is building for a broader market rally.
Crypto trader Byzantine General believes Ethereum is more than ready for a big surge. He even posted on X that Ethereum could experience a “monster rally.”
Ethereum recently managed to jump past the $2,800 level, which was its first return to this price point since August. Naturally, this unexpected price jump has caught the attention of traders, including analyst Miles Deutscher. He pointed out that ETH’s performance outpaced both Bitcoin and Solana (SOL) in a 24-hour period.
Ethereum’s price action over the past 24 hours (Source: CoinMarketCap)
Market dynamics in the ETH/BTC ratio also add to the speculation that ETH’s value could be set to rise. Analyst Benjamin Cowen pointed out that Ethereum’s value relative to Bitcoin might have already bottomed out, which suggests that a move above the Simple Moving Average (SMA) could signal a recovery in the ETH/BTC ratio. The ratio recently rebounded 5.36% after hitting multi-year lows. While traders considered the drop as a potential buying opportunity, some now suggest that ETH could be on the verge of a big breakout.
Crypto trader Ryandcrypto added to the bullish sentiment by predicting that Ethereum’s potential rally to $5,000 will be “the most hated rally of all time.” Meanwhile, 10T Holdings founder Dan Tapiero believes that Ethereum is “too cheap.” Tapiero believes ETH’s trajectory is only just beginning, and he is confident that the altcoin could surpass $8,000 in the coming year.
Ethereum is also seeing increased institutional interest, which could fuel its upward momentum even more over the next few months and into the new year. The State of Michigan Retirement System recently increased its exposure to Ethereum ETFs in a Nov. 4 SEC filing.
Ether ETFs See Highest Inflows in Six Weeks
Spot Ether exchange-traded funds (ETFs) in the United States also saw an impressive resurgence in investor interest after the recent US presidential election. On Nov. 6, the nine spot Ether ETFs recorded a net inflow of $52.3 million, which was their highest inflows in six weeks. Although this amount is comparatively small next to the inflows into spot Bitcoin ETFs, it was still the highest level of Ether ETF activity since Sept. 27, according to Farside Investors.
Ethereum ETF flow (Source: Farside Investors)
Fidelity’s Ethereum Fund led the charge by receiving $26.9 million, followed by the Grayscale Ethereum Mini Trust, which attracted $25.4 million. The remaining seven Ether ETFs, including BlackRock’s iShares Ethereum Trust, saw no inflows. This resulted in a net zero flow for BlackRock despite being the leading fund in this category. However, the overall net position for Ether ETFs are still at a deficit of $490 million because of large outflows from Grayscale’s ETHE fund.
Meanwhile, spot Bitcoin ETFs saw a much larger inflow that amounted to $621.9 million. This latest inflow reversed a trend of outflows over the previous three trading days. Despite BlackRock’s iShares Bitcoin Trust experiencing outflows of $69.1 million for a second consecutive day, the fund also saw its largest trading volume ever, with $4.1 billion traded.
Fidelity’s Wise Origin Bitcoin Fund led the Bitcoin ETF inflows with $308.8 million, which was its largest day since early June. Additional inflows of over $100 million were recorded by funds from Bitwise, Ark 21Shares, and Grayscale.
Tether Moves $2B USDT to Ethereum
Another factor that could boost the positive sentiment surrounding Ethereum is the fact that Tether, the issuer of the stablecoin USDT, recently completed a cross-chain transfer of more than $2 billion in USDT to the Ethereum network. The transfer was conducted on Nov. 6, and it involved moving 1 billion USDT from the Tron network, 600 million USDT from Avalanche’s C-Chain, 300 million USDT from the Near Protocol, and 60 million USDT from the EOS network.
Tether explained that the swap was requested by a large, unnamed exchange that wants to consolidate its USDT holdings on Ethereum. The stablecoin firm also assured people that this movement will not impact the total USDT supply at all as these were simply shifts across different blockchain networks.
This transfer happened not long after The Wall Street Journal reported an alleged investigation into Tether by the US government over potential money laundering and sanctions violations. Although the investigation is still officially unconfirmed, the report led to temporary unease in the crypto markets as investors reacted to the uncertainty surrounding USDT, which is the largest fiat-pegged stablecoin.
In response to these concerns, Tether CEO Paolo Ardoino provided a very detailed breakdown of the reserves backing USDT at the PlanB event in Lugano, Switzerland. According to Ardoino, Tether’s reserves include approximately $100 billion in US Treasury bills, 82,000 Bitcoin that is worth about $6.2 billion, and 48 tons of gold.
Despite USDT's role in everyday trading, recent data from Chainalysis revealed that stablecoins are also being used more and more as a store of value in countries experiencing rapid local currency depreciation.
Trump Meme Coins Tank Despite Election Victory
Despite Ethereum’s successes over the past couple of days, things are not going well for all altcoins. After Donald Trump’s presidential election victory on Nov. 6, meme coins that are associated with his brand suffered some big losses, even though the broader crypto market surged.
The leading Trump-themed meme coin by market cap, MAGA (TRUMP), initially spiked to $4.60 after the election results were announced, However, the crypto ended up plunging by more than 50% in the last few hours.
MAGA (TRUMP) price action over the past week (Source: CoinMarketCap)
Other Trump-related tokens experienced similar declines. MAGA Hat (MAGA) fell by 67% and Dark MAGA (DMAGA) dropped by 59%. Super Trump Coin (STRUMP) and MAGA: Fight for Trump (TRUMPCOIN) also saw sharp declines after losing 55% and 26%, respectively.
Trump himself holds around 579,290 TRUMP tokens, according to Arkham Intelligence. Despite his election win, these tokens have not retained their earlier price momentum, and experienced a steep sell-off along with the Trump-themed token market.
Meanwhile, the rest of the meme coin market enjoyed positive performances yesterday. Dogecoin (DOGE) gained 10% to reach $0.20 and Shiba Inu (SHIB) rose 6%. The third-largest meme coin by market cap, PEPE, saw an impressive 18% increase.
PEPE price action over the past 24 hours (Source: CoinMarketCap)
