Is Ethereum Undervalued? A Close Look at Realized Price and Institutional Activity
Amid broader cryptocurrency market sentiment in recent weeks, Ethereum price action is no different from what has been recorded in the past few months. During this period, Ethereum prices have been working hard to gain huge upward momentum, staying in Extended integration phase.
In this, recently analyze MAC_D, a contributor of CryptoFant, illuminates the current state of Ethereum and the factors that may affect its future price trajectory. The analysis points to the challenge of Ethereum’s “ultrasound currency” narrative (the idea closely related to the merged general tokenology).
Total supply totals have reached record highs since November and the average has dropped by 1%. But despite these supply-side barriers, several demand-side factors suggest that Ethereum may be positioned for long-term growth.
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Underestimate, holder’s behavior and institutional interests
Another key insight from the analysis is that Ethereum is undervalued based on its implementation. The realized price reflects the average acquisition cost of ETH Holdings in all wallets, currently around $2,200.
With the current market price of around $2,600, analysts calculated the market value with a slightly higher value of realization (MVRV) ratio than 1, indicating that ETH is still undervalued relative to historical norms. This level can serve as a strong support base, possibly Limit further disadvantages.
Another factor supporting the potential upside of Ethereum is the behavior of long-term holders. The analysis highlights an increasing number of addresses that pile up Ethereum without selling, similar to Bitcoin’s “permanent holders”.
Although some of the larger investors have been sold during the recent downturn, their positions have been absorbed by these long-term holders, helping stabilize the market. This trend shows that Ethereum’s investor base is maturing, with more and more committed to holding assets through market volatility.
Ethereum: The main rebound on the horizon?
In addition, analysts pointed out that sales pressure in the futures market has eased. Data shows that since Ethereum’s price approached $4,000 last November, the seller’s market price trading volume has dropped significantly.
Even if prices fall, this decline in sales activity indicates a relatively influx of purchasing power, if Market conditions have improved.
Institutional participation is another encouraging factor. Major players including BlackRock, Cumberland County and other prominent companies have reportedly accumulated a large amount of ETH during the recent downturn.
For example, Black Stone is said to have Purchased over 100,000 ETHworth more than $270 million. Such a significant institutional inflow not only strengthens demand, but also increases the credibility of Ethereum’s long-term investment papers.
Despite these positive indicators, the analysis acknowledges lingering challenges. An increase in total supply and a slight decline in shareholding may weigh emotional trade-offs, especially when macroeconomic situations remain uncertain.
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Additionally, as broader markets digest ongoing economic shifts, price movements in Ethereum may still be restricted in the near term. However, undervalued, strong long-term holders involved, reduced sales pressure and Institutional accumulation It depicts a more optimistic medium- and long-term prospect.
While Ethereum may continue to trade sideways in the near term, the factors outlined in the analysis suggest that it may provide a good attitude to growth once the broader market conditions stabilize.
Feature images created with DALL-E, TradingView’s chart
