Bitwise CIO on Ether’s ‘Demand Shock’: Why ETH’s Rally Has Staying Power

Ether's recent price action may be fueled by more than just sentiment. According to Bitwise Asset Management Chief Investment Officer Matthew Hougan, the world’s second-largest crypto asset is undergoing what he calls a “demand shock,” driven by surging inflows into exchange-traded products and new corporate treasury strategies.

In a thread posted Tuesday on X, Hougan broke down why he believes ether's rally is only getting started. Since mid-May, he estimates that spot ETH exchange-traded products (ETPs) and corporate treasuries have acquired a combined 2.83 million ETH — roughly $10 billion at current prices. That’s 32 times greater than the amount of net new ETH issued during the same period.

“Sometimes, it really is that easy,” Hougan wrote, referencing the role of supply and demand in determining short-term prices. He noted that while bitcoin has benefited from this dynamic for more than a year, ETH only began experiencing the same effect recently.

According to Hougan, spot ether ETPs launched in July 2024, but saw limited traction through the first half of 2025. By May 15, total inflows stood at just $2.5 billion, with ETPs acquiring about 660,000 ETH — closely matching the 543,000 ETH newly minted by the network. During this period, he says, ETH lacked the same support that drove bitcoin higher: “There were no major Ethereum Treasury Companies to speak of.”

That changed in the past two months. Hougan pointed to the emergence of publicly traded treasury holders like BitMine Immersion Technologies (BMNR) and SharpLink Gaming (SBET), which have accumulated hundreds of thousands of ETH while staking for yield. With ETP momentum also accelerating, the combined pressure has created a structural supply imbalance.

Looking ahead, Hougan predicts demand could rise even further. If treasury firms and ETPs purchase $20 billion in ETH over the next 12 months — as he believes they could — that would equate to roughly 5.33 million ETH at today’s prices. By comparison, Etherfeum is projected to issue just 800,000 new ETH over the same timeframe.

“ETH is of course different from BTC,” he acknowledged. “Its price is not set purely by supply and demand, and it doesn’t share BTC’s capped long-term issuance. But right now, that doesn’t matter.”

At the time of writing, ETH is trading at $3,658, down 0.69% in the past 24 hours, according to CoinDesk Data. Over the past seven, 14, and 30 days, it is up 15.8%, 40.1%, and 62.5%, respectively.

Technical Analysis Highlights

• According to CoinDesk Research's technical analysis data model, ETH traded in a $134.34 range from July 22 at 10:00 UTC to July 23 at 09:00 UTC, swinging between $3,763.70 and $3,629.35.
• Institutional resistance emerged near the $3,750–$3,760 zone during July 22’s evening session, with volume peaking at 445,297 contracts.
• Ether slid 1% during final trading hours, closing at $3,661.35, as corporate sellers stepped in above $3,740.
• The $3,700 mark has become a key pivot, acting as both support and resistance as corporate positioning flattens.
• Volume spikes above $3,740 suggest large-scale distribution and potential near-term consolidation.

Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.