Ethereum (ETH) has been on a rollercoaster ride over the past year, experiencing significant volatility in its price movements. After a 22.7% decline year-over-year and a steep 45.3% drop in Q1 2025, Ethereum saw a strong resurgence with a 36.5% surge in Q2, driven primarily by a robust May performance of 41.1%.
As we enter Q3, Ethereum is once again gaining momentum. Starting July at $2,403.98, ETH has already climbed over 6% to reach $2,593.60. In the past week alone, it has added 5%, indicating a renewed bullish sentiment in the market.
Analyst Eric Conner recently labeled Ethereum as a "powder keg," suggesting that multiple bullish signals are aligning for a potential explosive move to the upside. Let’s dive into the key drivers behind his thesis:
- Stablecoin Growth Shows Strength
Ethereum continues to play a crucial role in the stablecoin ecosystem, with stablecoins on the platform reaching a market cap of $251 billion at its peak. Currently, stablecoins hold $126.31 billion, with a $888.92 million increase in just seven days. This steady demand highlights strong on-chain activity and confidence in Ethereum’s infrastructure. - ETH ETFs Attract Institutional Money
Ethereum ETFs are gaining traction rapidly, with over $1.17 billion in net inflows recorded in June alone. Even in July, inflows remain positive despite daily fluctuations, with BlackRock’s ETHA and Grayscale’s ETHE pulling in $54.8 million and $10 million, respectively, on July 1. This trend underscores the growing interest from traditional finance, signaling bullish prospects for ETH in the long run. - Exchange Supply is Shrinking
According to CryptoQuant, the supply of ETH on centralized exchanges has been steadily decreasing from 19.51 million at the beginning of 2025 to 19.03 million currently. A lower supply on exchanges means that buying pressure could lead to quicker price movements, setting the stage for a potential breakout. - Whales Are Loading Up
Wallets holding 1,000 to 10,000 ETH accumulated over 800,000 ETH per day during a week in June, marking the most aggressive buying spree since 2017. This accumulation by large players indicates a strong belief in a bullish reversal, even during a slight dip in ETH’s price in June.In conclusion, with increasing ETF inflows, robust stablecoin activity, dwindling exchange reserves, and significant whale accumulation, Ethereum appears poised for a major breakout. If ETH can surpass the $2,600 resistance level, a rapid price rally could ensue.
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