Ethereum (ETH) declined by 2% in June, recording a performance below expectations, but several indicators are drawing attention for a positive outlook in the upcoming July. Ethereum, with a smaller market size compared to Bitcoin (BTC), is more sensitive to market movements and thus experienced a larger decline, but analysis suggests that it can also expect higher returns during upward trends.
The cryptocurrency market in June showed an overall sluggish trend amid US interest rate policies and global trade uncertainties. While the S&P500 index rose by 4.25% during the same period, demonstrating the strength of the US stock market, Ethereum remained in negative monthly returns even after rebounding from a 24% adjustment.
However, the assessment is that Ethereum's long-term growth potential remains. While Bitcoin rose by approximately 46% from April to early June, Ethereum soared by 100%, climbing from $1,400 to $2,800 (about 3.89 million won). Moreover, market prediction institutions believe that Bitcoin could reach $150,000-$200,000 (about 208.5-278 million won) by the first half of 2025, suggesting a high possibility of Ethereum following a similar steep rise.
Four supporting factors are also emerging for this optimistic outlook. The first is the Layer 2 fee war. Following the 'Dencun upgrade' introduced in March last year, fees significantly decreased, and L2 coins like Polygon (POL), Optimism (OP), and Arbitrum (ARB) grew, expanding the Ethereum ecosystem. While base chain fee revenue dropped from $30 million annually to $500,000 in the first quarter, analysis suggests overall usage demand hasn't diminished.
The second positive signal is the expansion of institutional investment. Sharplink Gaming purchased approximately $30 million (about 41.7 billion won) of ETH last month, actively incorporating Ethereum into corporate financial strategies. This is similar to Strategy Inc.'s approach of buying Bitcoin since 2020, and their related stock prices indeed skyrocketed. Sharplink's case suggests the potential for future Ethereum-centered corporate investments.
The third factor is whale investor movements. On June 22nd, a whale address purchased ETH worth approximately $39 million (about 54.1 billion won), sending a strong market signal. Such Ethereum movements outside exchanges reduce circulation and increase price pressure.
Lastly, Bit Digital, a New York-listed company, selling Bitcoin and moving to $34 million (about 47.3 billion won) worth of ETH is noteworthy. The company is adjusting its financial portfolio in line with Ethereum staking strategies and L2 ecosystem expansion, proactively reflecting market trends.
Thus, various factors such as technical signals, institutional support, ecosystem growth, and investment indicators support Ethereum's potential recovery in July. Attention is focused on whether Ethereum will show a full-scale rebound in a market led by Bitcoin.
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