Ether Surges 190% to $3,600 on Record ETF Inflows

Ether’s recent surge to $3,600 is driven by robust inflows into US spot Ether exchange-traded funds (ETFs) and favorable macroeconomic signals, suggesting sustained momentum rather than an imminent correction. On Wednesday, inflows reached $727 million, marking the largest single-day capital injection since Ether ETF trading commenced in July 2024. These inflows represent a critical factor in reducing available circulating supply, as the purchased Ether is transferred directly into cold custody, effectively removing it from immediate market circulation.

Felix Xu, partner at ZX Squared Capital, emphasizes that this institutional demand, combined with the current macroeconomic environment, creates a supportive backdrop for Ether’s sustained growth. The Federal Reserve’s ambiguous stance on interest rates adds to this dynamic, with political pressures urging dovish policies that tend to favor risk assets like cryptocurrencies. Xu notes that “macro conditions are mixed rather than toxic,” underscoring the nuanced but generally positive environment for Ether.

The inflows into Ether ETFs not only signal growing institutional confidence but also act as a supply constraint, which is a crucial driver in price appreciation. As these assets move into cold storage, they are effectively locked away from trading, tightening the supply-demand balance. This phenomenon is particularly impactful in the context of Ether, where network upgrades and staking mechanisms already reduce circulating supply.

Moreover, the uncertainty surrounding Federal Reserve policy injects an additional layer of bullish sentiment. With ongoing debates about interest rate cuts and economic stimulus, investors are increasingly viewing Ether as a hedge against traditional market volatility. This dual effect of supply reduction and macroeconomic uncertainty creates a compelling case for Ether’s resilience in the near term.

Despite the bullish momentum, industry experts caution that reaching a $10,000 valuation for Ether within the year remains a challenging prospect. Felix Xu points out that such a price would require a nearly 190% increase in just over five months, a feat only previously achieved during exceptional market conditions like the 2017 ICO boom and the 2020-21 DeFi surge. However, Xu acknowledges that this target is not entirely out of reach if several positive catalysts align. These include sustained ETF inflows, integration of staking within Ether ETFs, a shift toward a more risk-on investor sentiment, and broader adoption of Ethereum’s technology stack. Key developments such as the expansion of layer-2 rollups and new decentralized application verticals could further reduce circulating Ether supply, amplifying upward price pressure.

Supporting this outlook, Trevor Koverko, co-founder of Sapien, describes the $10,000 target as ambitious but plausible under continued macro tailwinds and growing ETF adoption. He highlights a paradigm shift in how Ether is perceived—from a speculative asset to a programmable digital infrastructure underpinning future financial systems. Such sentiment is echoed by technical analysts who forecast Ether’s price potentially reaching between $7,000 and $10,000 based on momentum indicators like the Relative Strength Index (RSI). These projections, while optimistic, underscore the importance of sustained investor confidence and technological progress in driving Ether’s valuation.

Ether’s recent price rally is strongly supported by record ETF inflows and a macroeconomic environment characterized by Federal Reserve uncertainty. These factors collectively reduce supply and enhance demand, positioning Ether for continued growth in the near term. While a $10,000 price target by year-end remains ambitious, it is contingent on the convergence of sustained institutional interest, technological adoption, and favorable market sentiment. Investors should monitor these dynamics closely, as they will be critical in shaping Ether’s trajectory moving forward.