In the world of cryptocurrencies, Ethereum is making significant gains, with its value increasing by over 4% and reaching around $3,200. This upward trend in Ethereum is reflective of the overall cryptocurrency market, which has seen a surge in its total market cap by 3.5%.
One of the key factors driving Ethereum’s rise today is the notable shift in capital from Bitcoin. As Bitcoin experiences a slight downturn, with its value at $64,854, Ethereum benefits. This can be seen in the ETH/BTC ratio, which has increased by about 2.5% in the last 24 hours, reaching 0.048 BTC by April 21. Alongside this shift, the Ethereum Dominance Index (ETH.D), a measure of Ethereum’s market strength compared to other cryptocurrencies, has also increased by over 1%.
This rally is not sudden but part of a larger rebound that started on April 19, coinciding with Bitcoin’s fourth halving. Since then, Ethereum has shown its relative strength against Bitcoin, with the ETH/BTC ratio increasing by approximately 3% and ETH.D by about 0.75%.
Historically, similar trends have been observed after Bitcoin halving events. For example, after the second halving in July 2016, Ethereum surged by as much as 64% against Bitcoin. After the third halving in May 2020, it nearly doubled in value compared to Bitcoin. This pattern suggests that investors may be reallocating their investments to Ethereum, believing that the anticipated price increase of Bitcoin due to the halving has already been factored in.
In addition to the capital shift, Ethereum’s surge is also supported by actions from its whales. Data from Glassnode reveals that the amount of Ethereum held in addresses containing between 1,000 and 10,000 ETH has increased in the past two weeks. Furthermore, addresses holding between 10,000 and 100,000 ETH are also on the rise, indicating a strong return of confidence among large Ethereum investors.
From a technical standpoint, Ethereum’s price support mechanisms are showing strength. The cryptocurrency has successfully tested the lower trendline of its descending channel pattern, which closely aligns with the 0.5 Fibonacci retracement level at around $2,800 and its 200-day exponential moving average (EMA) near $2,700. These technical indicators are seen as favorable buying zones by traders, indicating strong market support for Ethereum.
Adding to the intrigue surrounding Ethereum, a dormant wallet that has been inactive for almost nine years has suddenly become active. This wallet, from Ethereum’s pre-mine phase before its official launch in 2015, initially contained 197 ETH, which was valued at around $61. Today, this stash is worth approximately $622,685. The activation of this wallet has sparked speculation about the identity and motives of its owner, suggesting a possible strategic move by an early Ethereum adopter who may have rediscovered lost keys or decided that now is the right time to re-enter the market.
All of these factors contribute to a comprehensive understanding of why Ethereum is currently experiencing an unpredictable rally. Each element paints a bullish outlook for Ethereum in the crypto community.