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- Ethereum’s seasonal Q1 trend and increasing ETF inflows could drive a move toward $6K if accumulation continues.
- Regulatory changes and macroeconomic factors remain key obstacles that could impact Ethereum’s bullish trajectory.
In alignment with a recent CNF report discussing Ethereum’s Total Value Locked (TVL) reaching a three-year peak at $90 billion, market confidence appears strong, yet ETH’s price remains stagnant. Historically, Ethereum (ETH) has demonstrated robust performance in the first quarter of each year.
A community tweet highlighted a key reason for accumulating ETH and altcoins, citing seasonality as a recurring trend in Ethereum’s market cycles. The tweet further explained:
“This year looks different because there’s so much happening, and the supply of altcoins has increased 100x since the last cycle. I won’t lie, things do look a bit dire, but my bet is on ETH outperforming in the next few weeks as we’ve seen in previous years (because seasonality hasn’t been invalidated yet).”
Historical Data Suggests a Seasonal Bullish Trend
Since 2020, Ethereum has recorded significant Q1 gains, with an average return of approximately 40%. In Q1 2021, ETH surged by over 100%, and in Q1 2024, it registered a 68.68% increase. This pattern suggests that Ethereum tends to exhibit strong bullish momentum in the early months of the year.
In this article, we will dive into the several factors contribute to this recurring uptrend:
Firstly, long-term holders are accumulating ETH at an increasing rate. Data indicates that the percentage of long-term Ethereum holders grew from 59% in January to 75% by the end of 2024, demonstrating strong investor confidence and reducing the circulating supply.
Additionally, the launch of Ethereum-based exchange-traded funds (ETFs) has fueled further demand. As of December 2024, spot ETH ETFs witnessed a cumulative net inflow of approximately $2.68 billion, highlighting heightened institutional interest.
Challenges on the Path to $6K
Despite these positive indicators, Ethereum still faces challenges that could impact its trajectory toward the $6,000 mark.
The crypto market remains highly volatile, and external factors such as regulatory shifts, macroeconomic conditions, and competition from other blockchain platforms could influence price movements.
Current Price and Market Outlook
While historical trends suggest a seasonal rally, they do not guarantee future performance. Investors should conduct thorough research and assess the broader market context when making investment decisions.
As of now, Ethereum (ETH) is trading at $2,734.45, reflecting a 0.31% increase in the past day and a 1.93% rise in the past week, according to CoinMarketCap data. See ETH price chart below.
