Why Ethereum to Outperform Bitcoin: $5.4B ETF Inflows, Whale Accumulation, and 2021 Breakout Pattern

[Ben Graham]

Ethereum (ETH) is capturing market attention with signals of a potential breakout reminiscent of Bitcoin’s historic 2021 bull run. Analysts cite a combination of strong technical indicators, increasing ETF inflows, and intensified whale accumulation as key reasons Ethereum could soon outperform Bitcoin.

ETH recently broke out of a classic falling wedge pattern, a technical setup often linked to trend reversals. This bullish formation, combined with multiple Relative Strength Index (RSI) taps, suggests Ethereum may be poised for a significant upward move.

The RSI behavior mirrors Bitcoin’s movements in early 2021, before it surged to record highs. Adding to the bullish narrative, Ethereum’s RSI has tapped its long-term trendline three times, a rare pattern seen during market bottoms and major trend shifts.

$5.4 Billion in Ethereum ETF Inflows Reflect Institutional Confidence

Institutional interest in Ethereum is surging. Over the past 20 days, Ethereum ETFs have recorded $5.4 billion in net inflows, with only one day of outflows in July. BlackRock’s ETHA ETF alone accumulated more than $4 billion, while the iShares Ethereum Trust added $1.7 billion across 10 straight trading days.

This ETF demand marks a strong signal of growing confidence among professional investors. On-chain data also reveals a 40% surge in Ethereum ETF holdings over the last month, a vertical trajectory that underscores rapid institutional adoption.

Whale Accumulation Adds Fuel to Ethereum’s Rally Potential

Whales are also aggressively accumulating. More than 200 new whale addresses have been added since early July. Notably, one address reportedly purchased $300 million worth of Ether via OTC deals through Galaxy Digital.

Despite recent price dips below $3,400, ETH rebounded to $3,560, signaling strong support and buyer interest. Analysts now see the ETH price forming a base for a sustained rally, especially if price closes above key resistance with rising volume.

Supported by favorable technical indicators, increased institutional investments, and substantial holder confidence, ETH appears well-placed to potentially outperform Bitcoin in the coming months.

As market participants anticipate the next upward movement, Ethereum may be poised to challenge Bitcoin’s prevailing market dominance.

Cover image from ChatGPT, ETHUSD chart from Tradingview