Ethereum’s $5K Target Faces Significant Hurdles

• Ethereum’s chances of hitting $5,000 by the end of 2024 have dropped to under 10%, despite strong ETF inflows and a 37% price surge needed.
• Ethereum ETFs saw $305 million in daily inflows on Dec. 10, with Fidelity contributing $202.2 million, signaling strong institutional interest and a potential supply crisis.

Ethereum, the second-largest cryptocurrency by market cap, faces dwindling odds of hitting $5,000 by the close of 2024, according to data from on-chain options protocol Derive. Despite strong inflows into Ether exchange-traded funds (ETFs), the much-anticipated probability has shrunk to less than 10%.

Sean Dawson, head of research at Derive, shared in a Dec. 10 report that Ethereum’s chances peaked at 16% but recently dipped to just over 8%. According to our data, Ethereum would need a 37% surge to achieve the $5,000 mark at its current price of $3,669.

Optimists Keep the $5K Hope Alive

Pseudonymous crypto trader CoinMamba shared a more bullish take, stating in a Dec. 10 social media post that their target for Ethereum remains $5,000 by year-end. “Do what you will with that information,” they added, leaving followers to interpret their confidence.

Adding to the discussion, Ethereum contributor Eric Conner highlighted the $305 million in daily inflows into Ether ETFs on Dec. 10. He views this as a precursor to a “supply-side crisis,” indicating that a tighter supply could potentially drive prices upward. According to data from Farside, Fidelity Ethereum Fund accounted for a significant $202.2 million of these inflows.

Anthony Sassano, an Ethereum educator, echoed similar sentiments, suggesting traditional finance (TradFi) institutions are taking advantage of lower Ether prices. He emphasized that “TradFi is gobbling up the cheap ETH.”

Retesting Highs or Plateauing?

The optimism doesn’t end there. Bankless podcast host Ryan Adams hinted on Dec. 9 that Ethereum could hit a new all-time high within a week. Ether’s current peak, $4,878, was reached in November 2021. Meanwhile, trader Pentoshi noted the cryptocurrency’s “highest weekly close of the year,” calling attention to structural changes and consistent ETF flows that might hasten a retest of its historical high.

As the broader crypto landscape evolves, predictions for Ethereum extend beyond 2024. Bitwise, a major cryptocurrency index fund manager, envisions Ethereum climbing to $7,000 by 2025. The firm attributes this potential surge to institutional adoption, regulatory support, and advancements in layer-2 scaling solutions.

Ethereum ETFs Surge Despite Price Dip

Data from Farside Investors revealed that daily inflows into U.S. spot Ethereum ETFs reached $305.74 million, bringing the total to an impressive $1.87 billion. Despite a recent decline over the past seven days, these ETFs saw their highest cumulative weekly inflows, reflecting strong institutional interest.

December has been a particularly positive month, with consistent inflows indicating growing institutional interest in Ethereum. For example, December 6 saw $83.76 million in inflows, while December 5 recorded a new all-time high of $428.44 million in net inflows. The total net assets now stand at $12.46 billion, adding $1.33 billion just in December.

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