dailyhodl.com
Cryptocurrency trader and YouTube influencer Lark Davis says Ethereum (ETH) is poised for a 190% rally en route to hitting a five-figure price.
In a new video, Davis tells his 431,000 YouTube subscribers that the second-largest crypto asset by market cap is preparing to appreciate to above $10,000 based on key fundamental factors.
Davis says one of the reasons why Ethereum is set to more than double in price is its falling supply in exchanges.
According to Davis, the supply of the leading smart contract platform in exchanges is in a strong downtrend over the past year as holders either lock their Ethereum in decentralized finance (DeFi) protocols or use their ETH to buy non-fungible tokens (NFTs).
With the supply mechanics working as they are, it’s only a matter of time before the Ethereum supply crisis ends up jacking up the price in a serious way.”
Davis also cites a tweet by blockchain intelligence platform IntoTheBlock, which says that the net amount of Ethereum exiting crypto exchanges recently reached a new record high.
“The net amount of Ethereum leaving exchanges just hit a new record. Over $1.2 billion worth of Ethereum left centralized exchanges yesterday. That is a mind-blowing number.”
The crypto trader adds that when Ethereum worth over a billion dollars previously left centralized exchanges, the price of the second-largest crypto rose by double-digit percentage points within around four weeks.
“And what’s interesting, as IntoTheBlock points out, the last time that a billion dollars or more of Ethereum left centralized exchanges, Ethereum increased by 60% within 30 days.”
Davis also says cites research by blockchain analytics firm Glassnode, which shows that a huge chunk of Ethereum’s supply has not moved within the last 90 days.
“87% of Ethereum supply has not moved on-chain for three months or longer. 87% of the supply! That is insanity”
The crypto trader says that the lack of movement is an indication that Ethereum holders are “waiting for higher prices,” driven by among other factors, the burning of Ethereum transaction fees.
“People are holding for higher prices, they’re not selling below the previous all-time high. They know a new all-time high is coming. They know price discovery’s coming. They’re watching and seeing what is happening economically with Ethereum right now. They’re seeing how much, for example, Ethereum is being burned at the moment…
We have now had $1.1 billion worth of Ethereum burned away – 309,500 Ethereum at the time recording this video.”
Davis also says the proliferation of scaling solutions, known as layer-2 protocols, is also bullish for the second-largest crypto asset as they boost demand for Ethereum.
“We’re also seeing Ethereum layer-2s taking off now. In order to use Ethereum layer-2, you need to have Ethereum. Plain and simple. You have to have ETH to pay the gas fees on Ethereum layer-2.”