The price of Bitcoin rose to an all-time high of $110,000 on May 21, 2025, surpassing its previous record of $109,000. Bitcoin and Ethereum generally exhibit a strong positive correlation – when there’s a surge in trading volume for BTC, it can also impact the price of ETH. Optimism surrounding Ethereum is significantly more enduring than that of Bitcoin as Ethereum is edging closer to a price threshold that could result in hefty rewards. Ethereum could reach $4000 by the end of 2025.
Insights from CryptoQuant reveal that Ethereum is now extremely undervalued, meaning its current market price is lower than its true or intrinsic worth. Inflows into accumulation addresses have reached their highest level in years, which indicates that long-term investors are actively buying and holding Ethereum, even during market downturns. Any ETH price prediction should be viewed with skepticism due to the volatile nature of the market. No one can guarantee future price movements with certainty.
Ethereum’s Price Has Increased By Over 50% In May 2025
The current state of affairs presents a difficult scenario for the world’s second-largest cryptocurrency. Ethereum reached $2,734 on May 12, 2025, and several factors contributed to this achievement, including the Pectra upgrade, filings for spot Ethereum ETFs, and Bitcoin’s historical performance. At the time of writing, ETH is trading at $2,617 and struggles to move decisively past the $3,000 barrier. Unless buyers step in with conviction, Ethereum will continue to experience bouts of resistance.
To pave the way for a possible rally, Ethereum must rise above $4,000. While no financial prediction is guaranteed, the strong fundamentals of the network, along with increased institutional interest and ongoing technological advancements, suggest a high probability of ETH sustaining and building upon that moment in the coming weeks. Ethereum surged by over 57% in the past month, which illustrates strong demand thanks to cooling international trade tensions.
Ethereum Offers More Predictable Performance
To appreciate changes in ETH’s value before investing, it’s essential to recognize its characteristics and history. Originating from the dissatisfaction with Bitcoin’s limited vision for the use of blockchain technology, Ethereum is a global supercomputer that anyone can use. Notwithstanding the general volatility of cryptocurrencies, it’s one of the most stable and flexible coins. This can be explained by the solid use cases of the network, particularly in the realm of decentralized applications. Ethereum is a versatile platform that extends beyond digital currency.
The Ethereum Virtual Machine, a decentralized computing environment, executes bytecode and smart contracts, digital agreements that are automatically executed when predetermined conditions are met. Decentralized applications use one or more smart contracts to operate. Ethereum decentralizes not only the trade of currencies but also different levels of business operations. ETH can be used to send and receive value without any intermediary. It can be used outside the network in the form of wrapped Ethereum, pegged to the value of the original coin.
Ethereum is one of the most established coins. It’s ranked number two in terms of market capitalization, which indicates ETH is a highly prominent and influential cryptocurrency. A high market cap implies high liquidity, which results in minimal price fluctuations. There’s a large number of buyers and sellers, not to mention a substantial volume of trading. Ethereum is viewed as a legacy coin, which means it’s well-suited for long-term holding since it carries fewer risks than newer, smaller tokens.
Why Is $4,000 A Major Hurdle For Ethereum?
ETH has moved by over 50% in the past few weeks to trade above $2,600. $4,000 is a critical price point at which Ethereum tends to either reverse or consolidate, and this can be attributed to a mix of technical, psychological, and market dynamics. When ETH draws close to $4,000, technical indicators like the Relative Strength Index (RSI) signal the asset may be overvalued, making traders cautious. Hence, many decide to sell to secure gains.
$4,000 is a psychological barrier, and as Ethereum tests support zones in the $3,800 and $3,900 range, optimistic investor outlook clashes with the tendency to lock in gains. Even if ETH sustains upward movement, the initial buyer enthusiasm may ultimately be tempered by investors securing profits. This so-called capital rotation generates temporary pauses or reversals. Although exchange-traded funds (ETFs) began trading on July 23, 2024, they haven’t had the impact people were expecting.
Ethereum Could Catch Up With Bitcoin In The Next Couple Of Weeks
Abraxas Capital acquired 46,295 ETH worth $115.3 million a few days ago, which indicates continued accumulation. The investment company has reduced its Bitcoin exposure by $150 million, suggesting a deliberate change in investment strategy, favoring Ethereum. After withdrawing ETH from exchanges, Abraxas Capital can use the funds in decentralized protocols to mint wrapped tokens. BlackRock prompts the SEC to allow Ethereum staking. While the outcome of the meeting hasn’t been disclosed, it increased market confidence.
ETH is burnt each day via blobs, which store large amounts of data off-chain. The daily number of blobs purchased by rollups has increased to 25,600 in the days after the Pectra upgrade went live. ETH burning escalades as blob usage increases, and this change affects Ethereum’s supply, which is considered good for the price, assuming demand remains constant or increases. Ethereum has a good chance to capitalize on Bitcoin’s recent moves, yet it depends on broader market sentiment and investor behavior.
Wrapping It Up
When Bitcoin rallies, it can create a ripple effect throughout the crypto market, influencing the actions and performance of other tokens, notably Ethereum. ETH’s solid fundamentals – its vast ecosystem, network upgrades, and role in powering decentralized finance – give it an edge over altcoins. Current technical indicators present a mixed sentiment regarding the cryptocurrency’s future. Ethereum could surpass its previous highs, but the inherent volatility of the market makes exact predictions challenging.
Ethereum looks very promising, but it’s critical to have an investing plan in place. It provides structure, clarity, and direction. Figure out which prices to buy/sell and decide whether you want to hold ETH as a short or long-term investment. It’s a good investment as long as you’re careful with it.
