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Ethereum Skyrockets 47% to Cross $3,600; Hedge Fund Predicts More Gains Ahead
Ethereum (ETH) has experienced a remarkable 47% surge over the past month, breaking past the $3,600 level and catching the attention of investors globally. Experts at hedge fund ZX Squared Capital believe the rally has more room to run, attributing the growth to strong market indicators and a favorable macroeconomic environment.
Felix Xu, a partner at ZX Squared Capital, stated on July 18, “The latest 'hard data' points to a low probability of a short-term correction,” adding, “At this time, the chances of a sharp reversal appear minimal.”
The ongoing rally has sparked significant interest, with analysts eyeing Ethereum's next potential milestones.
ETF Inflows Hit Record Highs, Squeezing Ethereum Supply
One of the key catalysts driving Ethereum’s price surge has been unprecedented inflows into spot Ethereum exchange-traded funds (ETFs) within the U.S. market. According to ZX Squared Capital, a massive $727 million flowed into these ETFs in just one day on July 17—the highest single-day inflow recorded since their launch.
Xu explained the impact of these inflows, stating, “The Ethereum allocated to ETFs is instantly transferred to cold wallets, making it effectively unavailable for circulation,” further emphasizing that this shrinking liquid supply exerts upward pressure on ETH prices given current market dynamics.
This trend has created what analysts are calling an “unsellable” portion of Ethereum, tightening supply as demand continues to grow.
Economic Uncertainty Underpins Risk Asset Rally
Ethereum's bullish momentum is receiving additional support from favorable macroeconomic conditions, according to analysts at ZX Squared Capital. Felix Xu highlighted, "While June's Consumer Price Index (CPI) revealed a slight uptick, former President Donald Trump’s ongoing pressure on the Federal Reserve to lower interest rates has created a tailwind for risk assets like cryptocurrencies."
Xu further outlined that the current situation lessens the likelihood of a substantial 30% correction, similar to what was witnessed in October last year. He noted that unless ETF inflows significantly dwindle or the Federal Reserve abruptly adopts a more hawkish stance, upward momentum is likely to continue.
Could Ethereum Reach $10,000? Market Speculation Grows
Amid Ethereum's meteoric rise in recent weeks, speculation about whether ETH could hit the $10,000 mark by year-end is intensifying. However, Xu urged caution: “A 190% increase from this point has only been achieved during significant industry booms, such as the 2017 ICO frenzy and the 2020–2021 DeFi movement,” he remarked. "Setting expectations this high might be premature for now."
That said, Xu did not entirely rule out the possibility. He elaborated, "For Ethereum to reach $10,000, we would need to see sustained ETF inflows, staking features integrated within Ethereum ETFs, a broader shift toward risk assets, and accelerated real-world adoption in the Ethereum ecosystem."
Xu also pointed to promising developments within the Ethereum ecosystem, such as the rise of Layer-2 scaling solutions, restaking dynamics, and applications that reduce circulating ETH supply. These, he added, are "concrete indicators of growing demand."
Ethereum as a Programmable Asset: The Future of Finance
Trevor Koverko, co-founder of the cryptocurrency platform Sapien, shed light on Ethereum's transformation from a speculative token to a vital part of the next-generation financial infrastructure. “Ethereum is now seen as a programmable digital asset that underpins decentralized finance (DeFi) and beyond,” Koverko noted.
He also shared his outlook on Ethereum’s price potential: “If favorable macro trends, ETF growth, and increased institutional trust converge, the $10,000 target is far from unattainable.”
As of 1:00 p.m. on July 18, Ethereum was trading at $3,585, according to CoinMarketCap, with both retail and institutional investors closely monitoring its trajectory.
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