Key Points:
Ether increased by 75% against Bitcoin in Q3, although it has slightly lagged in September.
Participation from retail investors remained limited, creating a divergence with institutional movements.
Ether (ETH) surged 75% relative to Bitcoin in Q3, and despite a recent slowdown in pricing, traders remain optimistic about the altcoin reaching $5,000 by 2025.
Glassnode data shows that interest from futures traders is primarily focused on Ether. Its open interest dominance is currently at 43.3%, the fourth-highest recorded, while Bitcoin stands at 56.7%. At the same time, Ethereum’s perpetual futures volume dominance has reached a record high of 67%, indicating a significant shift in trading focus toward Ether.
Similarly, CryptoQuant analyst Crazzyblockk pointed out the essential criterion for a potential Ether breakout. The analyst noted that regaining the $4,580 level, associated with accumulation and exchange outflow cost bases, is critical.
With over 1.28 million ETH, valued at more than $5.3 billion, transferred into long-term accumulation addresses on Thursday, a successful reclaim could shift market sentiment and possibly lead to a $5,000 breakout.
ETH has established support around $4,100, in line with the average cost basis of highly active addresses.
Related: Last chance for Ethereum? ETH price pattern breaks down as $4K must hold
Institutional Demand Shrinks Ether Supply, But Is Retail Participation Dwindling?
Recent Ether demand has been largely propelled by institutions, leading to a decrease in circulating supply. US spot ETH ETFs have witnessed a rise in total net assets to $27.48 billion in September from $10.32 billion in June, contributing over $17 billion in net assets from July to August.
Further institutional demand has come from Strategic Ethereum Reserves, with contributions increasing from 5,445,458 ETH on July 1 to 12,029,054 ETH by September 23, marking a 121% boost, currently valued at approximately $46 billion.
In spite of this significant rise in institutional buying, retail participation appears to be fading. Net taker volume on Binance has remained negative over the past month, reaching a peak in late September, signaling ongoing sell-side pressure despite broader enthusiasm for altcoins.
The spot taker CVD (Cumulative Volume Delta) indicator, reflecting the cumulative difference between market buys and sells over 90 days, has shown a taker sell dominance since late July. This indicates that retail traders have consistently sold ETH more than they have bought, further emphasizing the divide between institutional accumulation and retail activity.
If retail flows become positive and the spot taker CVD transitions to a buy-dominant phase, ETH could experience a rally driven by retail, complementing ongoing institutional purchases and potentially enhancing the broader market momentum.
Related: Ethereum bulls tout supercycle, but Wall Street is skeptical
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
