Ethereum Is Ready For Inevitable Climb Over $10,000, Says Crypto Analyst
The year has come with a lot of optimistic predictions for the price of the second-largest cryptocurrency by market cap. Its current trends have seen analysts put the digital asset at above $10,000 by the end of the year. And now, another crypto analyst, Lark Davis, has echoed what his counterparts have been saying in regards to the altcoin.
Lark believes that Ethereum breaking above $10,000 is inevitable and only a matter of time. Saying that the digital asset is poised to grow 190% would see it break this price point. The crypto analyst lays out his analysis on his YouTube channel, which currently has over 433K subscribers. In the video, Lark says that this price is already “programmed in” and adds that “it’s coming.”
Declining Ethereum Exchange Reserves
Lark starts out his analysis by pointing to the depleting supply of Ethereum. More specifically, the exchange supply of Ethereum being low such that there isn’t a lot of ETH waiting to be sold as the price goes higher. This is evident in the recent volume of ETH being withdrawn from exchanges. Recently, Ethereum saw record volumes being taken out of exchanges as 1.2 billion worth of ETH had been withdrawn from centralized exchanges last week in the space of 24 hours.
Related Reading | Ethereum Sees Record Daily Volume Withdrawn From Centralized Exchanges
The analyst points out that the decline in the available supply of Ethereum is leading to a supply-side crisis. Bulls have accumulated some of their biggest bags so far and will most likely not be dumping their bags soon. More often than not, waiting for the price of the asset they invested to 5-10X before they think about dumping their bags. So these long-term holding is creating a supply shock for Ethereum.
ETH price struggles with new week opening | Source: ETHUSD on TradingView.com
Comparing the supply to last year, Lark notes that the exchange supply continues to drop dramatically, save for a few spikes. While supply outside exchanges grows as people move their coins out of exchanges to use for other activities like staking. Comparing the charts and movement, Lark points out that while the supply drops, the price of Ethereum rose with this decline. This trend is similar to the current trend of Ethereum. Exchange supply has fallen and if history repeats itself, this puts the market close to testing another price discovery for the digital asset.
ETH Burn Is Rocket Fuel For Price
Crypto analyst Lark Davis brings to the forefront of the ETH burn. With over 300,000 ETH already burned in just six weeks after the upgrade, amounting to over $1.1 billion, Lark sees about 1 million ETH being burned by the end of the year. This is adding to the supply shock currently expected to come. With less ETH coming into circulation, supply is going to dwindle.
Related Reading | TA: Ethereum Plunges to $3,150: Can Bulls Save the Day?
Lark refers to this rate of burn as “rocket fuel for price appreciation.” This amount of Ethereum being burned gives credence to Lark’s prediction for a 190% increase in the price of ETH, which would lead to the altcoin breaking the $10,000 price point.
Finally, Lark points out that the big money is starting to notice Ethereum. An example of this is Cathie Wood revealing her firm, ARK Invest, has gained more confidence in the asset, explaining that they would split their crypto bags into 40% ETH and 60% BTC. This interest from institutional investors will be the driving factor for Ethereum towards $10,000.
Featured image from CryptoPotato, chart from TradingView.com