Ethereum News Today: Ethereum's 32:1 Supply-Demand Imbalance Sparks 65% Price Surge from Corporate and Institutional Demand

Bitwise Asset Management’s chief investment officer Matt Hougan has warned that a “structural imbalance” between Ethereum (ETH) supply and demand could drive prices to new heights, citing a surge in institutional and corporate purchases. In a 22 July 2025 memo to clients, Hougan highlighted that Ether had risen over 65% in the past month and nearly 160% since April, driven by a sharp disparity between Ethereum’s new issuance and absorption by exchange-traded products (ETPs) and corporate treasuries [1].

Hougan compared the dynamic to Bitcoin’s 2024 rally, when U.S. spot ETPs and institutional buyers acquired 1.5 million BTC while the blockchain produced only 300,000. For Ethereum, he noted that between 15 May and 20 July, ETPs attracted over $5 billion in net inflows, while publicly traded firms amassed 2.83 million ETH—worth over $10 billion. During the same period, Ethereum’s network generated just 88,000 ETH, creating a 32:1 demand-to-supply ratio [1].

Key corporate buyers included Bitmine Immersion Technologies (BMNR), which accumulated 300,657 ETH ($1.13 billion), and SharpLink Gaming (SBET), which purchased 280,706 ETH ($1.06 billion). Both firms cited ambitions to expand their ETH holdings, with BMNR aiming for 5% of total supply. Bit Digital (BTBT) shifted $170 million in Bitcoin reserves to 100,000 ETH ($375 million), while The Ether Machine (DYNX) outlined a $1.6 billion Ether-based IPO. Hougan emphasized that these acquisitions, combined with ETP inflows, created a “self-reinforcing” cycle as companies traded at premiums to their ETH holdings, incentivizing further capital raises and purchases [1].

The CIO projected that ETPs and treasury firms could absorb $20 billion in ETH—equivalent to 5.33 million coins—over the next year, far outpacing the network’s expected issuance of 800,000 ETH during the same period. This 7:1 imbalance would mirror Bitcoin’s post-ETP launch dynamics, according to Hougan. He also argued that Ethereum’s under-ownership in the ETP market—Ether funds hold less than 12% of assets compared to Bitcoin despite a fifth of the market cap—left room for further inflows, especially with growing interest in Ethereum-based stablecoins and tokenization [1].

Critics often highlight Ethereum’s uncapped supply and reliance on network utility, but Hougan dismissed these as long-term considerations. “In the short term, the price of everything is set by supply and demand,” he wrote, noting the current demand exceeds supply. At press time, ETH traded at $3,703, with the asset facing a key resistance level before a potential all-time high [1].

Source: [1] https://www.newsbtc.com/news/ethereum/ethereum-demand-shock-bitwise-cio/