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Ether Resurgence Gains Steam Backed by Spot ETF Demand and On-Chain Growth: Citi
Spot ether ETFs have seen growing demand with cumulative net inflows now more than $13 billion, up from $2.6 billion in April, the report said.
Updated Aug 20, 2025, 1:57 p.m. Published Aug 20, 2025, 12:04 p.m.
What to know:
- Ether has rallied nearly 30% year-to-date after a steep drawdown earlier this year, testing bitcoin’s dominance as capital rotates, according to the report.
- Citi noted that institutional flows have accelerated, with spot ETH ETF inflows surpassing $13 billion and treasury companies boosting holdings to around $10 billion.
- On-chain accumulation has risen as large wallets move supply off exchanges, creating a potential squeeze dynamic alongside improving network activity, the bank said.
After enduring a drawdown of more than 55% earlier this year and lagging peers amid tariff-driven risk-off sentiment, ether has staged a powerful comeback, Wall Street bank Citi (C) said in a research report on Tuesday.
The second-largest cryptocurrency is now up nearly 30% year-to-date, testing bitcoin’s dominance in a way not seen since late last year. This time, however, ether is taking market share rather than ceding it, the report said.
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Spot ether exchange-traded funds (ETFs) have seen a surge of demand. Cumulative net inflows now top $13 billion, up from just $2.6 billion in April, analysts Alex Saunders and Nathaniel Rupert wrote.
As ETF balances grow, flows are playing a more direct role in price dynamics, the analysts said.
Ether treasury firms have also joined the bid, with large purchases beginning in May. Their collective holdings now hover near $10 billion at current market values, while the equity valuations of these companies have expanded alongside ether’s rally, the report noted.
Blockchain data shows large wallets accumulating ether while smaller investors trim exposure. Ether balances on centralized exchanges continue to decline, signaling a shift of supply back on-chain. This dynamic could be amplifying the latest leg higher, creating a squeeze-like effect, the report added.
While the rally has been sharp, the bank's analysts caution it isn’t purely technical. On-chain activity has picked up, reinforcing the move with stronger fundamentals. Combined with a macro backdrop that resembles a “goldilocks” environment, neither too hot nor too cold, ether's resurgence could have legs, particularly with supportive regulatory signals and bullish narratives in play.
Read more: Ether-Led Rally Pushed Crypto Market Cap to $3.7T in July: JPMorgan
AI 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.
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