Decoding Ethereum’s role as ‘a store of value’ – Can ETH hit $3.2K soon?

Key Takeaways 

• Fidelity views ETH as a store of value, similar to the currency of emerging economies. ETH briefly flipped BTC in trading volume and speculative interest. 

Ethereum [ETH] has the full attention of Wall Street, with asset manager firm Fidelity now viewing ETH as a store of value (SoV) and wealth preservation alternative.   

In its latest report, the asset manager stated, 

“Ether is used to pay for any transaction on the Ethereum blockchain, regardless of the type of transaction…Ether can serve as a medium of exchange and a store of value.”

Fidelity added that blockchains have an embedded currency (ETH for Ethereum network), hence should be compared to sovereign nations and their economies, and not Web 2 firms. 

The firm also highlighted that ETH is the most actively traded asset on exchanges and also acts as ‘the primary asset to borrow against.’

Market reactions

The above update has been viewed as relief and a vote of confidence in ETH. In 2024, ETH suffered a massive market disconnect and divergence from BTC. 

At that time, the altcoin was under intense pressure for not being a SoV like BTC. It dropped nearly 70% against BTC and has lagged behind even Solana [SOL].

So, the Fidelity’s report was welcomed, especially by pro-ETH members. 

Reacting to the report, Sassal, an Ethereum educator, termed it ‘bullish,’ stating that ETH is undervalued. 

“ETH is a $100 trillion asset trading at $316 billion.”

Most recently, analysts have made bullish projections for ETH amid an expected stablecoin boom and internet capital markets (on-chain stocks). 

Following the Fidelity update, ETH sentiment climbed higher to ‘greed’ level and pumped 2.8% to $2.6K.

Overall, the growing positive sentiment has since triggered ETH to flip BTC in daily trading volume and speculative interest, per CoinGlass data.

Notably, at press time, ETH’s Open Interest (OI) rate jumped 7% against BTC’s -0.18%. This underscores the massive demand for ETH on the Futures market. 

Over the same period, the derivatives trading volume surged to $59 billion, about $3 billion more than BTC. If the trend continues, ETH could outperform BTC in the near term, in terms of investor returns. 

That said, the market skew for end-quarter 3 (Q3) was bullish with a Put/Call Ratio of 0.44, underscoring a premium for calls (bullish bets) over puts (bearish bets). 

Most of the bullish targets were at $2.8K and $3.2K with a max pain (potential floor price, where options contracts expire worthless) around $2K. 

Overall, ETH could still be subdued below $3K in Q3, but options traders were still betting for a potential breakout.