cryptopolitan.com
Ethereum ($ETH) is seeing lower unrealized gains during its latest rally, potentially helping it avoid selling pressure. $ETH switched to accumulation, surpassing $BTC with short-term demand in July.
Ethereum recovered to levels not seen since March 2024, inching up toward the $4,000 level. However, the token is not weighed down by unrealized profits this time around.
According to Glassnode data, $ETH has much lower relative unrealized gains. In the past year, Ethereum whales were busy trading, trying to achieve a lower average price. During the latest rally, however, some of the purchases were made at a higher market price in a rush to secure available tokens.
Despite $ETH trading near its March 2024 highs, unrealized profits are far lower. Back then, #$ETH hit +2σ (standard deviations) on Relative Unrealized Profit at $3.98K – today it's just nearing +1σ. A move to +2σ now would imply ~$4.9K $ETH. pic.twitter.com/TdmCIzp3Pm
— glassnode (@glassnode) July 31, 2025
The relatively low metric of unrealized gains may mean recent buyers are more willing to hold, potentially signaling a larger $ETH rally. During previous $ETH local peaks, whales often sold, depressing the price. Even older holders from the ICO era, or the Ethereum Foundation, were frequent sellers near market peaks.
$ETH proved resilient, even defying the recent market where most altcoins took a step back. $ETH continued its climb on Thursday, rising to $3,832.37. The recent ratio between unrealized gains and the current price suggests $ETH may attempt a hike close to $5,000, recovering its all-time high.
$ETH also reached a six-month peak of 0.032 $BTC, potentially reversing the trend of being seen as doomed to always slide in $BTC pricing. $ETH dominance expanded to 11.7%, while traders awaited a spillover for a wider altcoin market.
Spot demand grows for $ETH
Demand for $ETH increases, based on a drive to use wrapped or staked forms of the token for passive income. The Ethereum unstaking validator queue also saw fewer requests after a recent spike. Buyers are trying to tap multiple sources of $ETH, including older staked coins or unwrapped $ETH.
The main driver of spot buying are still ETFs, which continued their aggressive accumulation. Both $ETH and $BTC are seeing an inflow of whale buyers, as Cryptopolitan reported earlier.
$ETH accelerated its net outflows from exchanges, showing the strengthening demand from individual whales and corporate buyers. Strategic $ETH reserves broke above $10B in total, after the latest purchases from BitMine and SharpLink Gaming. In total, buyers take 413K $ETH from the market each week, while only around 15K are minted and retained in the supply.
$ETH demand may come from the eventual addition of staking and in-kind settlement for ETFs and other vehicles. The requirement for Ethereum reserves may boost spot demand additionally. Additionally, over 35% of $ETH is locked, representing 28.3% of the supply.
$ETH awaits short squeeze to $3,900
Another major driver of the $ETH rally is the peak open interest and the accumulation of short positions. Currently, liquidity has accumulated around $3,900, suggesting a short squeeze may drive the price of $ETH higher.
In the past 12 hours, $ETH saw a shift to short liquidations, attacking $20M up to the $3,800 price range. On a 24-hour basis, $ETH saw more than $93M in long liquidations. Currently, $ETH may make a move toward $3,600 based on accrued long liquidity.
Ethereum open interest is still above $26B, down from a recent $28B peak. $ETH saw significant liquidations, but quickly returned to speculative trading, as the asset awaited a renewed rally.