During the previous month, Ethereum [ETH] has witnessed a surge in demand and a significant rise in its price, reaching $3500 for the first time since July.
While ETH has struggled to match Bitcoin’s [BTC] performance – with Bitcoin hitting new all-time highs five times in the past week – Ethereum has experienced a 34% spike in its value on a monthly basis.
Notably, Ethereum saw a substantial increase in price from $3031 to $3500 in the past week alone. This surge was accompanied by a remarkable influx in Ethereum staking activity, with weekly netflows reaching an all-time high, as reported by Maartunn.
Record High Weekly Netflows for Ethereum Staking
According to data from IntoTheBlock, Ethereum’s staking activities have witnessed a significant uptick in weekly netflows after several months of outflows.
During the past week, Ethereum’s staking activities showed a total netflow of +10k ETH, with 115k ETH being deposited and 105k ETH withdrawn.
This substantial netflow is a significant shift in market dynamics compared to the extended period where withdrawals consistently exceeded deposits.
Maartunn suggests that the surge can be attributed to the rise in ETH prices and the enhanced staking infrastructure, marking an essential development for ETH prices by reducing the token’s supply and inflation.
Increased inflow is a positive sign for the overall growth of the Ethereum ecosystem and the future value of ETH.
Analysis of Ethereum Charts
The reduction in Ethereum’s supply is further evident with the increasing stock-to-flow ratio, signifying a scarcity that often drives value by reducing oversupply.
Scarcity tends to boost prices when an asset is in high demand with limited availability.
Further analysis by IntoTheBlock indicates a substantial inflow from large holders into Ethereum, reaching a monthly peak, which suggests that significant holders are actively acquiring the altcoin, thereby exerting buying pressure and tightening the supply.
Price Implications
The positive impact of increased net flows on ETH prices is noticeable. Despite the rise in deposits, Ethereum’s value has surged, currently trading at $3381, reflecting a 7.82% increase.
While facing resistance from bears, Ethereum’s upward momentum is clear, with the potential for further gains if buyers dominate the market, potentially pushing ETH to reclaim the $3560 resistance level.