Ethereum Will Hit $5,000 After ETFs Launch, Predicts Bitwise Exec

Matt Hougan, chief investment officer at Bitwise Asset Management, forecasted on Wednesday that the price of Ethereum could surge past $5,000 following the launch of Ethereum ETFs.”[ETF] inflows will push prices to all-time highs, above $5,000,” he declared. “BHougan’s “I think the first few weeks could be choppy, as money may flow out of the $11 billion Grayscale Ethereum Trust (ETHE) after it converts” to an ETF, he wrote.The primary driver for this anticipated price surge is the interplay between supply and demand, he said. ETFs introduce new demand without altering Ethereum’s underlying supply fundamentals. Hougan outlines three key reasons why Ethereum might see an even greater impact from ETF inflows than Bitcoin.Ethereum’s inflation rate has been 0% over the past year, meaning the supply of ETH has remained constant at 120 million. This contrasts with Bitcoin’s 1.7% inflation rate at the time its ETFs launched. Hougan said Ethereum-based stablecoins and tokenized funds support the equilibrium between ETH creation and consumption, leading to price appreciation. Unlike Bitcoin miners who need to sell their mined BTC to cover operational costs, Ethereum stakers are not under the same pressure. “There is simply less forced selling each day in Ethereum than in Bitcoin,” Hougan noted. substantial portion of ETH is staked or locked in decentralized finance (DeFi) contracts. “Currently, 28% of all ETH is staked, meaning it is effectively off the market,” he wrote.Hougan said he expects Ethereum ETFs to attract $15 billion in new assets over the first 18 months, a significant influx that could drive ETH from its current trading price of approximately $3,400 to new heights. With ETH trading at around $3,400—just 29% below its all-time high—Hougan concluded that the introduction of ETFs and the resulting demand dynamics make it likely that Ethereum will challenge and surpass its previous records.