Ethereum's ETH may be the first to hit a new all-time high, ahead of Bitcoin, according to the analysis. On Wednesday, the CEO of on-chain analytics service CryptoQuant, Ki Young Ju, highlighted in a tweet a sell-side liquidity crisis that could give ETH an edge over BTC.
An intensification of Ether's liquidity shortfall
Since then, Bitcoin has recovered more than 50% from its lows of $ 29,000 and altcoins have joined the rally. Ether is no exception to this rally, as the largest altcoin has regained the $ 3,000 level. As of this week, this level is in the process of being retested as support.
Although much attention is paid to Bitcoin recovering the $ 50,000 mark, there is a lot of excitement for Ether, which has held its price after its successful London fork. The hardfork that was rolled out earlier this month shows the state of the altcoin and the enthusiasm of the community.
The fork has driven changes in supply, leading to a liquidity shortfall that could push ETH / USD to new all-time highs before BTC / USD. According to Ki Young Ju, the current price of ETH is closer to ATH compared to BTC.
The numbers show that Bitcoin exchange reserves have been declining since May and only returned in July. However, reserves fell to 2.44 million this week from a high of 2.54 million on July 26. On the other hand, ETH has experienced a relatively linear downtrend since the late May local high of 21.43 million on exchanges. Currently, the balance exchange rate is around 19.25 million.
Market sentiments on supply shocks
Ki isn't the only one forecasting a wilder bullish charge for Ether compared to Bitcoin. Bloomberg Intelligence has also been in favor of ETH over BTC in a recent post forecasting a "sea change" for the largest cryptocurrency.
The data has also indicated that Bitcoin will suffer a supply shock in the near future, a fact that has its own historical precedent for initiating BTC price rises. Analyst William Clemente made comments on the latest figures from Glassnode, an analysis resource, indicating that the illiquid supply shock index had been a good leading indicator in recent months.
He stated that the impulses in both directions have led to a follow-up of the price action. The metric continues to climb slowly, so another boost is likely imminent.