- It is quite likely that Ethereum goes back to its all-time high sooner than Bitcoin does, says CryptoQuant CEO.
- ETH exchange reserves have been reduced by a greater proportion compared to Bitcoin, possibly giving it an edge over BTC.
Ethereum (ETH) might reach its all-time high (ATH) earlier than Bitcoin (BTC), says Ki-Young Ju, CEO of CryptoQuant on-chain analytics. In a tweet, Ju said Ethereum’s “sell-side liquidity crisis”, which continues to escalate, could give it an advantage over BTC.
In the past few weeks, Bitcoin has risen over 30 percent higher than its lows of $29,000. With the same energy, altcoins have also taken on the trend, Ethereum being no exception. The largest altcoin has re-attained the $43,000 mark and is now retesting it as a support level.
Despite huge attention on Bitcoin hitting $50,000, the crypto community has remained optimistic in Ether’s trend. This is especially after the network successfully deployed the London hard fork earlier this month. The update brought with it new changes in supply, which are causing a liquidity shortfall. Thanks to this, ETH is likely to could climb to historic heights faster than BTC will. CryptoQuant CEO Ki-Young Ju, recently noted;
Current $ETH price is closer to ATH compared to $BTC. Higher demand, lower supply. $ETH sell-side liquidity crisis still intensifies, while $BTC exchange reserve stopped its downward trend in May.
Fast-declining Ethereum exchange reserves
Ki Young Ju, pointed out that ETH might have some corrections in the short term, which is technically normal. However, he still thinks Ethereum will someday outperform Bitcoin.
Statistically, Bitcoin exchange reserves have been shrinking since May but started to return in late July. From a July 26 peak of 2.54 million, BTC reserves this week dropped to 2.44 million. Similarly, ETH exchange reserves have also been on a linear downtrend since May’s high of 21.43 million. The trends have also renewed a two-year low. However, the exchange balance of 19.25 million this week was proportionally less than that of BTC.
Reportedly, a Bloomberg Intelligence report had a similar view of Ether’s more aggressive bull charge compared to Bitcoin’s. The report even predicted a “flippening” of Bitcoin. This refers to a theoretical dog-eat-dog event where an altcoin surpassed BTC in terms of market capitalization.
Battle of supply shocks
Nonetheless, data indicates an ongoing Bitcoin supply shock as well. Historical precedents show that this is something that will unrelentingly fire up the price of BTC.
Illiquid Supply Shock ratio has been a good learning indicator over the past few months,” William Clemente III said, commenting on the latest figures from Glassnode on-chain market intelligence resource. He further added;
Impulses in both directions have resulted in price action following. As the metric continues to grind slowly upward, currently at levels prev. 58K BTC watching for another major impulse.
At writing time, BTC was exchanging hands at $44,885 according to our data. This is 30.9 percent less than its $65,000 record high. ETH, on the other hand, was trading at $3,005, which is 28.5 percent less than its $4,200 ATH.
