Ether Faces $10B Demand Shock as Spot ETFs and Treasuries Drive Supply Crunch
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Ethereum (ETH) may be heading for structurally higher prices, according to Bitwise CIO Matthew Hougan, who highlights a growing supply imbalance triggered by spot ETH ETFs and corporate treasury accumulation. Despite a slight dip to $3,658 on Wednesday, the second-largest crypto has soared over 60% in the past 30 days, and analysts say the rally could just be beginning.
$10B Demand Since May—With More Coming
Hougan says a “demand shock” is reshaping ETH’s price dynamics. Since mid-May, institutional buyers — including spot ether exchange-traded products (ETPs) and public treasury firms — have purchased 2.83 million ETH, worth approximately $10 billion.
That’s 32 times more than the newly issued ETH supply during the same timeframe.
Hougan notes that while Bitcoin has benefited from supply-demand imbalances for over a year, ETH is just now entering this phase, with inflows rising sharply in recent weeks.
The launch of spot ETH ETFs in July 2024 drew modest interest at first, with only $2.5 billion in inflows by mid-2025. But momentum exploded starting in May as companies like BitMine Immersion (BMNR) and SharpLink Gaming (SBET) began aggressively acquiring ETH for their corporate treasuries — often staking it for yield.
Together, ETPs and treasury firms are creating a structural ETH shortage, with Hougan forecasting potential purchases of 5.33 million ETH in the next 12 months — while only 800,000 ETH are expected to be newly minted.
“Sometimes, it really is that easy,” Hougan wrote. “If buyers are absorbing 7x more ETH than is being created, prices go up.”
According to CoinDesk data, ETH ranged between $3,763.70 and $3,629.35 in the last 24 hours. Volume surged as sellers emerged near the $3,750–$3,760 level, pushing ETH down 1% to $3,661 into the close. The $3,700 price now acts as a key pivot for short-term traders.
Conclusion
ETH’s 2025 rally may have deeper roots than hype. A sharp rise in institutional participation — led by ETF inflows and altcoin-focused treasuries — has triggered a demand shock that’s absorbing available supply at record pace. If this trend continues, Ethereum could be on track for new all-time highs in the months ahead.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.
