Ethereum’s Supply-Demand Sweet Spot: Why the Rally Is Just Getting Started

Ethereum has jumped more than 65% in the past month and 160% since April, driven by a growing gap between supply and demand. According to Bitwise CIO Matt Hougan, Ethereum’s current trajectory mirrors Bitcoin’s earlier post-ETP surge, where demand outpaced supply by a wide margin.

Institutional investors and corporate buyers have absorbed over 2.83 million ETH, worth more than US$10 billion (AU$15.25 billion), since mid-May. That figure is 32 times greater than the 88,000 ETH minted during the same time frame. Spot Ethereum exchange-traded products alone accounted for more than US$5 billion (AU$7.63 billion) of this buying pressure.

Corporations have also contributed significantly to the surge in ETH demand. Bitmine Immersion Technologies holds 300,657 ETH (AU$1.72 billion), while SharpLink Gaming owns 280,706 ETH (AU$1.62 billion), with plans to raise an additional US$6 billion to acquire more. Bit Digital, meanwhile, sold off its Bitcoin reserves to purchase more than 100,000 ETH worth (AU$572 million).

Related Bitwise CIO: Circle’s Blockbuster IPO Underscores Need for Dual Crypto Strategy

Institutions Poised to Keep Buying ETH

Bitwise estimates that these entities could acquire up to 5.33 million ETH, worth around US$20 billion (AU$30.5 billion), within a year, while only 800,000 ETH is expected to be issued in the same timeframe. That would mark a 7:1 ratio of demand to new supply.

Ethereum’s ETH/BTC ratio has climbed from 0.018 in mid-May to 0.031, reflecting its outperformance against Bitcoin. As ETH treasury companies are valued more highly than the ETH they hold, attracting further investment.

Related: Ethereum Rakes in a Record‑Shattering $2.12B Weekly Inflows Amid Massive Global Crypto Flows

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