The Ethereum Demand Shock

The price of Ethereum has been going up recently. Here’s why that’s likely to continue.

The price of Ethereum is up more than 65% in the past month, and over 160% since April. But I think it’s headed higher still in the coming months, and for a simple reason: supply and demand.

Let me explain.

The Bitcoin Asymmetry

The bull case for Bitcoin is simple: Since the launch of spot Bitcoin ETPs in the U.S. in January 2024, there has been a structural imbalance between demand and supply.

What sort of imbalance? ETPs, corporations, and governments have acquired more than 1.5 million Bitcoin, while the Bitcoin blockchain has produced just over 300,000 Bitcoin. Prices are up 155% since then, making Bitcoin the best-performing major asset in the world over this time.

5x more demand than supply. Sometimes it really is that simple.

What About Ethereum?

Until recently, Ethereum hadn’t benefited from the same trend.

Through May 15, 2025—roughly 10 months after they launched—Ethereum ETPs had purchased just 660K ETH, with ~$2.5 billion in inflows. Meanwhile, purchases by public companies were de minimis. And over the same time frame, the Ethereum network produced 543K new ETH—basically a wash.

Not surprisingly, ETH’s price lagged Bitcoin significantly.

Price Returns: Bitcoin vs. Ethereum

Source: Bitwise Asset Management. Data from December 31, 2023 to July 20, 2025.

But something changed in mid-May. Since May 15, spot Ethereum ETPs have been on a tear, pulling in more than $5 billion. Corporations have also gotten into the game, with multiple firms announcing the creation of new Ethereum treasury strategies. For instance: 

• Bitmine Immersion Technologies (BMNR) began acquiring ETH in late June, and today holds 300,657 ETH (worth $1.13 billion). The company announced its long-term goal of obtaining 5% of all ETH supply.

• SharpLink Gaming (SBET) began acquiring ETH in July, and today holds 280,706 ETH (worth $1.06 billion). It’s planning to raise an additional $6 billion to buy more ETH.

• Bit Digital (BTBT) raised $170 million and sold its Bitcoin positions to fund the acquisition of more than 100,000 ETH (worth more than $375 million).

• The Ether Machine (DYNX) announced plans to go public with a $1.6 billion ETH treasury and has its sights set on more.

All told, since mid-May, ETPs and public companies have combined to buy 2.83 million ETH—more than $10 billion at today’s prices, and 32x the increase in ETH’s supply over the same time period.

No wonder the price of ETH has soared.

Will This Persist?

The right question to ask next is: Will this persist?

We think the answer is yes.

Investors are still underweight Ethereum vs. Bitcoin: Although ETH’s market cap is about 20% the size of BTC, Ethereum ETPs have amassed less than 12% of the assets of Bitcoin ETPs. With all the excitement surrounding stablecoins and tokenization—which are primarily built on Ethereum—we think that will change, and that we’ll see billions in flows in the next few months.

Meanwhile, all signs suggest the “ETH treasury company” trend will accelerate. The key to growth for crypto treasury companies is whether their public stock trades at a premium to the value of the crypto assets they hold, and right now that’s true for ETH treasury companies. For instance, both BMNR and SBET trade at nearly 2x the value of their ETH holdings. As long as that remains true, you can bet Wall Street firms will funnel money into more ETH purchases.

Looking out, we wouldn’t be surprised if ETPs and ETH treasury companies bought $20 billion of ETH in the next year, or 5.33 million ETH at today’s prices. Meanwhile, the Ethereum network is expected to produce roughly 0.80 million ETH over the same period.¹ That’s nearly 7x more demand than new supply—an even higher ratio than we’ve seen for Bitcoin since the spot ETPs launched in 2024.

You could argue that ETH is different from BTC, that its price is not set purely by supply and demand, and that it doesn’t share BTC’s capped long-term issuance. That’s true in an absolute sense, but right now, it doesn’t matter.

In the short term, the price of everything is set by supply and demand, and right now, there is more demand for ETH than supply. As a result, I think we’re heading higher.

Sometimes, it really is that simple.

Notes:

(1)  Source: Ultrasound Money

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