Key insights:
Ether outperformed Bitcoin by 75% in Q3, yet showed slight underperformance in September.
Weak retail investor engagement contrasts with strong institutional inflows.
In Q3, Ether (ETH) surged 75% relative to Bitcoin, and traders remain optimistic about the altcoin potentially reaching $5,000 by 2025, despite recent price fluctuations.
Data from Glassnode reveals sustained interest from futures traders in Ether. The current open interest dominance for Ether is at 43.3%, ranking fourth all-time, while Bitcoin maintains 56.7%. Additionally, Ethereum’s perpetual futures volume dominance reached an all-time high of 67%, indicating a significant shift in trading activity toward Ether.
Furthermore, CryptoQuant analyst Crazzyblockk pointed out a crucial factor for an Ether breakout. He noted that reclaiming the $4,580 level, associated with accumulation and exchange outflow cost bases, remains essential.
On Thursday, over 1.28 million ETH, valued at over $5.3 billion, moved to long-term accumulation addresses, suggesting that a successful reclaim could shift market sentiment and potentially trigger a $5,000 breakout.
ETH has identified support around $4,100, aligned with the average cost basis of active addresses.
Related: Final opportunity for Ethereum? ETH price pattern declines as $4K must hold
Institutional interest tightens Ether supply, but is retail involvement diminishing?
Current demand for Ether is primarily fueled by institutions, leading to a decrease in circulating supply. US spot ETH ETFs have experienced an increase in total net assets, rising to $27.48 billion in September from $10.32 billion in June, gaining over $17 billion during July and August.
Further institutional interest stemmed from Strategic Ethereum Reserves, managed by Bitmine and SharpLink, which escalated their allocations from 5,445,458 ETH on July 1 to 12,029,054 ETH by September 23, marking a 121% rise, now valued at about $46 billion.
Despite this surge in institutional demand, retail engagement seems to be decreasing. Net taker volume on Binance has remained negative for the past month, with the trend peaking in late September, indicating ongoing sell-side pressure amid broader altcoin enthusiasm.
The spot taker CVD (Cumulative Volume Delta) indicator, which monitors the cumulative market buy-sell difference over 90 days, has maintained a taker sell dominance since late July. This means retail traders have been consistently selling ETH more than buying, underscoring the divergence between institutional gains and retail actions.
If retail flows shift to a positive trend and the spot taker CVD moves into a buy-dominant phase, ETH could experience a rally driven by retail investors, spurring ongoing institutional accumulation and possibly accelerating market momentum.
Related: Ethereum advocates claim supercycle, but Wall Street remains doubtful
This article is not intended as investment advice or recommendations. All investment and trading activities come with risks, and readers should conduct their own research before making decisions.
