Highlights:
- Significant institutional investments and market optimism boost Ethereum’s potential rise to $5000.
- The Beam Chain proposal and the shift to proof of stake could significantly enhance Ethereum’s scalability and security.
- Analyst predictions and trading trends suggest Ethereum remains undervalued, with a favorable risk-to-reward ratio supporting further gains.
The crypto market continues to exhibit a bullish outlook as the leading asset, Bitcoin, hovers above the $90k threshold. The altcoin sector has not lagged behind, with most of the coins recording major gains, pushing the prices to new highs. For example, XRP has recorded a meteoric surge, climbing above the $1 mark, a level last seen three years ago.
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However, despite the broad bullish sentiment fueled by the recently concluded U.S. elections, Ethereum, the largest altcoin, has been outperformed by most of the other altcoins. Given the ongoing developments, rising institutional demand, and several other factors, Ethereum may hit $5000 before the end of 2024 despite the stallment.
Ethereum Price Outlook
As of press time, Ethereum is trading at $3,111, down 2.10% in the past 24 hours. On the weekly chart, ETH is down by 2.60% despite the monthly surge of 25%. Ethereum’s trading volume and market capitalization stand at $27.88B and $375.24B, respectively, securing its position as the second-largest crypto asset.
ETH breached the $3k key level on 9th November following the broad market rally. However, it faced strong resistance at the $3,440 region, leading to a pullback to the $3,200 and $3,100 levels. Ethereum’s support is currently seen at the $3k level, whereby a break below this level could push ETH to the $2,750 region.
However, should the bullish momentum hold, ETH could break past the $3,400 resistance level to challenge the key resistance levels at $3,500 and $3,700. But how is this possible? Let’s take a look at factors that could lead Ethereum hit $5000 before end of 2024.
Factors That Could Lead Ethereum to Hit $5000
Rising Institutional Demand
Recently, Ethereum ETFs have seen significant inflows, totaling over $800 million in just six days following the U.S. election results. This surge signals growing investor confidence, particularly after the SEC’s approval in July. Despite initial outflows from the Grayscale Ethereum Trust (ETHE), the market sentiment has shifted positively.
6 straight days of inflows for spot eth ETFs…
Approx $800mil total.
Last 3 days = top 3 individual inflow days since launch.
Category has absorbed $3.2bil in ETHE outflows.
Now net positive by nearly $250mil.
Coming to life.
— Nate Geraci (@NateGeraci) November 14, 2024
In addition, institutional investors like the Michigan Retirement System have begun adopting Ethereum. In its latest 13-F filing, the fund disclosed an $11 million investment in Ethereum ETFs, marking it as the first public pension fund to invest in Ethereum.
This trend reflects a broader acceptance of cryptocurrencies in traditional portfolios, evidenced by Ethereum now surpassing Bitcoin in the Michigan fund’s holdings. With $7 million invested in Bitcoin, the shift towards Ethereum showcases its rising demand among investors.
Continuous Ethereum Ecosystem Developments
On November 7, the Ethereum Foundation launched the “Mekong” testnet to trial the Pectra upgrade. This upgrade enhances crypto wallets, introduces account abstraction, and raises validator staking limits to 2048 ETH. It also revamps deposit and withdrawal mechanisms.
🚨 JUST IN: @ethereum Foundation launches Mekong, a temporary testnet for developers to trial future upgrades before mainnet deployment safely. pic.twitter.com/JrrEs6pIVG
— Coinwaft (@coinwaft) November 7, 2024
Then, on November 12 at the Devcon conference in Thailand, researcher Justin Drake unveiled the “Beam Chain” proposal, dubbed “Ethereum 3.0.” It aims to reduce block times, lower staking requirements, incorporate on-chain snarkization, and boost quantum security using technologies like zkVM, improving scalability without relying on Layer 2 solutions.
Moreover, Ethereum co-founder Vitalik Buterin also spoke at Devcon 2024, highlighting Ethereum’s transition from proof of work to proof of stake (PoW to PoS). This shift enhances network security and decentralization, reducing Ethereum’s energy consumption and making it more sustainable. Buterin described Ethereum as a “world computer,” emphasizing its capability to support a vast, decentralized digital economy.
"Ethereum is: the world computer, an incredibly large & diverse onchain economy, and an incredibly large & diverse global community…all at once."
– @VitalikButerin in his talk 'Ethereum in 30 Minutes' at the Devcon SEA Opening Ceremony pic.twitter.com/dbDlXYGmQQ
— Deva the Devcon Unicorn (@EFDevcon) November 12, 2024
Experts Foresee a Substantial Upward Movement for ETH
Since the beginning of 2024, Ether has surged nearly 9.85%, with analysts still viewing it as undervalued. Crypto trader Byzantine General tweeted on Nov. 6 that ETH is likely to initiate a significant rally.
I'm gonna share possibly a controversial opinion, but I think that this massive open interest build up contains a fuck ton of shorts and I think that $ETH has a very real chance of going on a monster rally now.
This might be a short squeeze that will be talked about for years. pic.twitter.com/y8nuPwjRet
— Byzantine General (@ByzGeneral) November 6, 2024
Additionally, Crypto Analyst Ali Martinez anticipates the Ethereum token could reach $6000, citing its favorable risk-to-reward ratio. This outlook follows Bitcoin achieving a new all-time high, potentially paving the way for Ethereum’s strong performance.
Final Thought
With rising demand from institutional investors, ecosystem upgrades and bullish market conditions, Ethereum may hit $5000 before the end of 2024. Continued innovation like the Mekong testnet, among other proposals for Beam Chain, strengthens its market position. Ethereum’s potential for a major breakout is still strong heading into the end of the year.
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