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Why $2,000 isn’t a long shot for Ethereum



Source: Unsplash

Bitcoin climbed to its new all-time high on 9 January 2021 and at press time, it seemed like it might be Ethereum’s turn to set a new ATH of its own, three years on from its previous one. Beginning the day at just over $1,250, one can argue that breaching its old ATH and setting a new ATH was as important as it has ever been, at press time.

However, with respect to Bitcoin, Ethereum might be gathering more organic momentum in the market, with the same evidenced by an on-chain indicator.

Ethereum’s high flow state coming from high outflows?

Source: Santiment

Over the past few months, Bitcoin’s exchange outflows have been rampant with a consistent accumulation of non-exchange wallets. A similar sentiment has now enveloped Ethereum’s landscape. The ratio of Ethereum tokens sitting on exchanges has continuously decreased, dropping down to 22% from 26.33% back in the month of September.

In doing so, it has differentiated itself from Bitcoin, with Ethereum becoming the highest asset taken off-chain over the past few weeks. With non-zero addresses reaching a new height of 52.5 million addresses, Ether’s realized price also spiked up to $453.

What next for Ethereum after reaching a new ATH?

Ethereum may completely mirror Bitcoin’s trajectory once it is above $1448. BTC’s value exploded after it crossed $20,000 on 1 December, jumping up to $42,000 on the 9th of January.

Keeping in mind such price progression, for Ether, a new all-time high of over $2,000 becomes apparent, with market structure indicative of a superior bull run, at press time. Q1 of 2021 may easily see Ethereum take a position above $2,000 before undergoing any form of correction.

In the hours before press time, the accumulation was continuing to rise, with Kraken and Binance, experiencing an outflow of over 7000 ETHs to off-exchange wallets. However, it is important to note that Huobi and Bitfinex registered inflows at the same time.

Bitcoin – Playing catch-up?

Source: Santiment

While Bitcoin has been in a pretty attractive position from the start of 2021, its price movement has stagnated over the past week. However, Santiment suggested that its network realized profit/loss was pointing to new entry opportunities. What does this mean? Well, BTC may catch up with its bullish trend again, especially if investors continue to rack up Bitcoins.

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Biraajmaan covers market trends of major cryptocurrencies. As a graduate in engineering, his interests lie in Blockchain technology. With over a year as a journalist, his articles focus on US and UK markets.

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