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.
ETH may shift between $3,900 and $3,600, depending on which side of liquidity accumulation is attacked first. | Source: Coinank
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.
