Ethereum: Undervalued or Facing a New Rally? Analysts are optimistic!

Ethereum: Undervalued or Facing a New Rally? Analysts are optimistic!

Analysts currently view Ethereum as fundamentally undervalued, and there are signs of an impending rally in the second half of 2025. Analysis from on-chain data platform CryptoQuant highlights that institutional market participants are increasing their investment in Ether, indicating growing confidence in its long-term performance. These observations are supported by several key valuation metrics that reveal a mismatch between market price and network activity. The NVT ratio (Network Value to Transactions Ratio) highlights this discrepancy, while the realized market capitalization (Realized Cap) is well below the current market price, suggesting additional potential.

Another interesting development is the decline in the amount of Ethereum on centralized exchanges. This suggests that many investors are transferring their holdings to cold wallets or storing them for the long term. This behavior reflects classic patterns of previous accumulation phases, which were often followed by major market movements. The continued capital inflows via approved Ethereum spot ETFs also indicate a “favorable positioning phase” for Ether, described by CryptoQuant.

Institutional investors and market trends

The market is currently under the influence of uncertainty, but technical analysts and institutional investors are optimistic. Ethereum is in focus due to its current price performance and chart patterns. Despite a decline of about 46% in 2023 and more than 60% below its all-time high set at the end of 2021, many analysts have noted that Ethereum shows chart similarities to Bitcoin before its recent rally. This could indicate a possible trend reversal.

A significant signal of institutional involvement was the investment by World Liberty Financial, a firm in which the Trump family is active. They have invested hundreds of millions of dollars in Ethereum, increasing confidence in the digital asset. Currently, Ethereum's price is at $1,837.19, while Bitcoin is stabilizing at $96,305.11.

Technical analysis and future developments

Technical indicators show that Ethereum has stabilized above the $1,800 level after experiencing a downtrend with a low of $1,415 in April. Chart analysis suggests a bottom is forming, and the formation of higher lows and higher highs could indicate a trend change. Resistance at $1,810 and $1,850 could be overcome, which could pave the way to $1,920 and possibly up to $2,100.

Additionally, Fidelity highlights long-term structural strength and undervalued potential for Ethereum. Monthly address metrics also signal a long-term upward trend or stable sideways movement, indicating interest from long-term investors. Annual net inflation is 0.63%, and while active Layer 2 transactions are down 11%, other metrics suggest healthy market performance.

Overall, market developments and institutional investors who are increasingly interested in Ethereum point to an interesting phase for Ether. The combination of technical analysis and on-chain data creates a bullish outlook on possible future price increases for the second largest cryptocurrency system.

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