Key takeaways:
Ether surged 75% against Bitcoin in Q3, but has seen a slight decline in September.
Retail investor involvement has been low, diverging from institutional trends.
Ether (ETH) experienced a 75% rally compared to Bitcoin in Q3, and despite recent price fluctuations, traders remain optimistic about reaching $5,000 in 2025.
According to Glassnode data indicated, futures traders are predominantly focused on Ether, with its open interest dominance at 43.3%, the fourth-highest recorded, while Bitcoin holds 56.7%. Furthermore, Ethereum’s perpetual futures volume dominance has reached a record high of 67%, marking a significant shift in trading activity towards Ether.
Additionally, CryptoQuant analyst Crazzyblockk pointed out a “key condition” for a potential Ether breakout. The analyst emphasized that regaining the $4,580 threshold, associated with accumulation and exchange outflow cost bases, is critical.
On Thursday, over 1.28 million ETH, valued at over $5.3 billion, was moved into long-term accumulation addresses. A successful reclaim could shift market sentiment and set the stage for a move towards a $5,000 breakout.
ETH has found support around $4,100, which corresponds to the average cost basis of active addresses.
Related: Last chance for Ethereum? ETH price pattern breaks down as $4K must hold
Institutional demand decreases Ether supply, but is retail fading the move?
Recent demand for Ether largely stems from institutional buyers, decreasing its circulating supply. US spot ETH ETFs have seen total net assets surge to $27.48 billion in September from $10.32 billion in June, adding more than $17 billion in July and August.
Additional institutional demand emerged from Strategic Ethereum Reserves, spearheaded by Bitmine and SharpLink, with allocations growing to 12,029,054 ETH by Sept. 23 from 5,445,458 ETH on July 1, a 121% increase, currently valued at around $46 billion.
Despite the surge in institutional interest, retail participation seems to be declining. Net taker volume on Binance has remained negative over the last month, peaking in late September, indicating ongoing sell-side pressure despite enthusiasm for altcoins.
The spot taker CVD (Cumulative Volume Delta) indicator, which measures the cumulative difference between market buys and sells over 90 days, has remained sell-dominant since late July. This trend suggests that retail traders have been consistently selling ETH more than buying, emphasizing the discrepancy between institutional accumulation and retail behavior.
If retail flows become positive and the spot taker CVD transitions to a buy-dominant phase, ETH could experience a retail-driven rally, complementing ongoing institutional activity and potentially enhancing 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.
