Crypto: Why Ethereum Has A Low Chance Of Reaching $5,000 This Year?

For several months, investors have been turning their attention to crypto ETH, hoping for a significant jump in its value. However, forecasts do not seem to favor the giant of smart contracts. According to the onchain options protocol Derive, the probability that Ethereum will reach $5,000 by the end of 2024 is less than 10%. This observation is striking, especially since massive inflows into spot Ether ETFs seem insufficient to reverse the trend.

The numbers don’t lie, but the crypto market remains complex

According to data from Derive, the probability that Ethereum will hit the coveted $5,000 mark has fluctuated, reaching a peak of 16% before dropping to around 8%.

This downward revision reflects a challenging economic reality for ETH, which requires a 37% increase from its current price to hope to break through this threshold. Despite daily ETF flows nearing $305 million, the market remains indecisive.

An apparent balance between call and put options suggests a neutral sentiment among investors, as noted by Sean Dawson, a researcher at Derive.

This relative disinterest contrasts with the enthusiasm displayed by some traders, including CoinMamba, who maintain an ambitious target of $5,000 for the crypto. But between optimism and reality, the path seems fraught with obstacles.

An “offer crisis” lurking?

ETFs, seen as the engine behind a possible explosion in the price of ETH, are also pointed out as catalysts for a future “offer crisis”. Indeed, data reveals that major players in traditional finance (TradFi) are massively acquiring ETH at low prices, thus reducing availability on open markets.

This could, paradoxically, limit short-term price increases while building long-term potential.

Eric Conner, a well-known contributor in the Ethereum ecosystem, and Anthony Sassano, a crypto educator, share this view. For them, the massive inflows observed in ETFs are a sign of strategic accumulation by TradFi, rather than an immediate response to demand. If confirmed, this scenario could drive up the value of Ethereum in the coming years, although it might reduce the chances of a significant rally before 2025.

While some analysts still anticipate a historic peak, market signals show persistent volatility and moderate expectations. For investors, the challenge will be to navigate between these divergent forecasts and adjust their strategies accordingly.

Thus, Ethereum, with its undeniable potential, remains faced with a complex environment where caution and anticipation will be key. While $5,000 may seem out of reach for this year, the future of ETH, like that of crypto itself, is an adventure filled with twists and turns. Furthermore, discover the three US economic data points that could disrupt the market.