June was a lackluster month for crypto market gains amid global uncertainty looming over international tariff policy and the future direction of US central bank rates.
US Stocks Outpaced Ethereum In June
For the 30 day window ending Friday, Jun. 27, the S&P 500 Index gained +4.25%.
The push overcame serious resistance from the tariff nail biters and took the broad US stock benchmark to a historic record close Friday.
But after running from $76,200 on 4/8 to $111,600 on 5/22, a +46% gain in a little over a month, Bitcoin’s price took some time to cool down in June. The cryptocurrency charted minor gains, which could be seen as a positive in the face of massive international turmoils and geopolitical shocks.
Meanwhile, Ethereum corrected by 24% before bouncing off the Jun. 22 support to finalize a 2% loss for the 30 days ending Friday, Jun. 30th. So does ETH have a problem that Bitcoin doesn’t?
Not really.
Ethereum is a smaller currency by market cap, about 14% of Bitcoin’s size. Traders still perceive it as a more speculative bet. So it tends to move in the same direction as BTC — by larger percentages.
That means on the way down, losses are frequently greater. But on the way up, gains are often greater too.
For example, during the crypto market’s rally from early April through early June, Bitcoin made a +46% gain. But during the same rally, Ethereum gained +100%, rising from the $1,400 handle to the $2,800 level.
Bitcoin and Ethereum Rainbow Charts
Double rainbow all the way across the sky?
Bitcoin is by and large the biggest leading indicator for the rest of the crypto market’s prices, including Ethereum. It appears to have a long ways to go before topping out this year or next.
Based on popular and authoritative analysts’ price targets for Bitcoin in 2025, it’s pacing to enter July and Q3 at 50% to 66% of its peak price before this cycle is over.
That means it could double or gain by half again its June price levels before the year is over.
Standard Chartered, Bernstein, Galaxy Digital, and Peter Brandt all expect $150,000 to $200,000 for BTC sometime in the next six months.
Bitcoin’s long-term price trend rainbow chart confirms these projections.
Meanwhile, Ethereum’s own long-term trend chart is shaping up to signal a three-peat of a multi-year trend.
If it happens the way it did the last two major market cycles, this Ether prices could be primed to rise by more than Bitcoin’s during the next big monthly rally.
If it turns out to be Bitcoin’s final push for its peak on this cycle as market watchers expect, Ethereum’s gains could signal the start of this cycle’s alt season in meme coins and Layer 2 app tokens.
In addition to the market technical setup for ETH prices in Q3, here are four further bullish signals supporting the leading smart contract platform’s price gains in July.
1. Who Will Win Ethereum L2 Fee Wars?
Ethereum’s price has taken time to absorb the shock of the Dencun upgrade on Mar. 13, 2024.
The upgrade lowers rates for Layer 2 apps to lock in tranches of transaction updates with the base layer chain.
In the 15 months since, developers have deployed a number of new apps with currencies that offer Ethereum services for lower fees.
The base chain’s fee revenue dropped from $30 million annually to $500,000 by Q1 of this year.
That saves users money, but a lot of Ethereum stakers who had their money parked in staking contracts to earn that fee revenue felt inclined to move it somewhere that it could still earn returns on their savings.
This is a massive factor in Ethereum’s sluggish price growth compared to Bitcoin’s over the past year. But it’s not that the latter is falling behind its competitors like Solana and Ripple.
When factoring in the growth of the post-Dencun L2 coins on Ethereum— like Mantle (MNT), POL (POL), Arbitrum (ARB), Optimism (OP), Movement (MOVE), and Starknet (STRK)— the money mostly didn’t leave Ethereum and go to its competitors. It went to another layer, powered by and supporting the base chain.
For that reason, Ethereum may be undervalued by a large number of the cryptocurrency market’s headline readers that don’t understand what happened.
Ethereum Identity Crisis?
Some have referred in the mean time to this awkward stage in Ethereum’s growth as an identity crisis. It’s an open platform and anyone can build on it in any way that the code can handle.
The question for Vitalik Buterin and crypto market investors who show up to value early is:
Will one of the slew of Ethereum scale and fee apps, some new app we haven’t heard of yet, or an upgrade be what implements the best ultra long term, future proof, platform-wide standardizations that define the network’s global advantages?
Find the answer to that question and you’re doing some real work.
2. SharpLink $30M ETH Buy
In another positive development, the corporate treasury race that started for Bitcoin supplies continues to rock the Ethereum markets.
SharpLink Gaming, bought another $30 million worth of ETH just before the Ether price chart threw a small cup and handle pattern. But why does this matter? Well, let’s see what happened to STrategy.
Led by founder and executive chairman Michael Saylor, Tyson’s Corner, Virginia-based Strategy Inc. and Bitcoin have both benefited from the company’s pivot in 2020 to simply pile up as much BTC as it can hold on to forever.
As a result of the cryptocurrency’s increasing popularity with investors since then, MSTR stock rallied 566% in under 11 months from $63 per share on Jan. 5, 2024 to a price peak of $420 on Nov. 22, 2024.
Over that same time, the S&P 500 Index rallied 27% from the 4697 level to 5969.
Every $100 spent on Strategy stock on Jan. 5 last year could be sold for $666 dollars on Nov. 22, paying back buyers $566 for saving their $100 with MSTR shares for a term of 11 months.
That’s like a downpayment on a new car lease with a high credit score.
Meanwhile, $100 spent on an S&P 500 ETF would have returned buyers $27. That’s more like a cheap dinner out for two. All for the same hundred bucks and the same 11 months.
That suggests regulated Wall Street investors wanted on to the Bitcoin bandwagon and found a way in Strategy stocks. Seeing the bullishness of corporate finance, Internet crypto markets were now racing Strategy to accumulate a scarce supply of BTC tokens.
Now, SharpLink is doing it again with ETH. The company’s stocks spiked over 8 days in late May from $3.76 per share to just under $80 a share as Wall Street rewarded the former gaming company for pivoting to accumulating a regulated corporate Ether treasury.
3. $39M ETH Whale Bite
Meanwhile, an Ethereum whale took a $39 million chomp out of the crypto dip on 6/22.
Ethereum’s forward outlook was too good for this whale not to bite at that 24% off discount tag.
Every token is a vote with a daily trading value that fluctuates on a global open market of crypto exchanges. Participants “vote” by locking, unlocking, moving, and swapping currencies, as often as they like, any time they like.
When crypto investors take Ether tokens off a crypto exchange, the remaining supply of ETH tends to attract higher prices at the point of sale. But when they stake ETH for yield, it creates even more support.
4. Bit Digital Drops $34M BTC for ETH
Not to be outdone by SharpLink, publicly traded, New York-based blockchain company Bit Digital, announced on 6/25 it is giving up $34 million worth of BTC tokens to move the proceeds into Ether and develop staking strategies.
They might profit well from determining in advance of the overall market which of the Ethereum scale and fee coins will deliver the most yield and gains together over timespans relevant to their balance sheet and calendar.
The post Ethereum Price Fell 2% In June But Has These 4 Bullish Signs Going Into July appeared first on CryptoPotato.
