ETH Long-Term Holders Reach 75%: Is a 2025 Price Rally Coming?

Ethereum’s Long-Term Holder Base Expands in 2024

Ethereum’s long-term holder base has grown significantly in 2024, reflecting increasing confidence in the asset. Data from IntoTheBlock shows a dramatic increase in Ethereum holders retaining their tokens for more than a year. As of December 30, 75.1% of Ethereum wallets held their tokens for over a year, a sharp rise from 59% in January. This 27% surge over the course of the year demonstrates Ethereum’s increasing appeal to investors.

This growth was not coincidental. The introduction of spot Ether ETFs in November played a key role. These ETFs, which incorporated staking features, attracted institutional investors by offering a way to earn yields while holding ETH. The inflows into these funds doubled from $1 billion to $2.1 billion by December, further driving demand and retention for Ethereum.

Bitcoin’s Long-Term Holders Decline

In contrast, Bitcoin’s long-term holder base saw a decrease in 2024. The percentage of Bitcoin holders holding their tokens for over a year dropped from 70% in January to 62.3% by the end of the year. This decline was primarily attributed to profit-taking during Bitcoin’s euphoric rise to $106,000 in mid-2024.

Analysts, such as Gert Van Lagen, noted a “blow-off top,” where long-term Bitcoin holders cashed out during this peak, triggering a subsequent correction in Bitcoin’s price. While Bitcoin remains the dominant player in the cryptocurrency market, this shift suggests growing market interest in Ethereum.

The Role of Regulation in Ethereum’s Price Action

Ethereum’s price performance in 2024 has also been influenced by favorable regulatory developments. The discussions around new SEC reforms and the increased oversight by the CFTC have added credibility to Ether-related products, contributing to institutional confidence in Ethereum. These regulatory strides are seen as vital in solidifying Ethereum’s position in the market.

On the other hand, Bitcoin faced challenges in 2024. The Crypto Fear & Greed Index dropped to 65 in December, indicating a cooling market sentiment. While Bitcoin remains the leader of the cryptocurrency market, this sentiment shift signals that Ethereum is becoming more attractive to investors.

Price Action: BTC vs. ETH

Bitcoin’s price experienced a correction in December, which made headlines. After reaching a record high of $106,000 in mid-December, Bitcoin fell by 12.3% to close the year at $93,000. Despite this significant sell-off, analysts remain optimistic about Bitcoin’s long-term potential, with projections suggesting a future rally to $200,000, albeit at a slower pace.

Ethereum, however, showed resilience amidst the broader market downturn. By December 30, Ethereum was trading at $3,418, maintaining its upward trajectory despite Bitcoin’s volatility. The Coin Republic reported that TOTAL3, a metric tracking the altcoin market excluding Bitcoin and Ethereum, approached its 2021 peak of $1.13 trillion, suggesting a breakout phase for Ethereum could be on the horizon.

Why This Matters: Ethereum’s Growing Influence

The increasing prominence of Ethereum’s long-term holders marks a significant shift in market dynamics. While Bitcoin has traditionally been the dominant force in the market, Ethereum is emerging as a formidable contender. The rise of staking, institutional adoption, and regulatory advancements has played a pivotal role in Ethereum’s growing market presence.

Although Bitcoin remains the “heavyweight champion” of cryptocurrency, Ethereum is steadily positioning itself as the market’s “middleweight contender,” with a strong case for growth in the coming years.

Conclusion

2024 has been a year of significant changes in the cryptocurrency market, with Ethereum’s price action and long-term holder growth contrasting sharply with Bitcoin’s volatility. Ethereum’s increasing appeal among long-term holders, coupled with favorable regulatory developments and growing institutional interest, positions it as a major player in the evolving digital asset landscape.

While Bitcoin remains the leader, Ethereum’s ability to adapt and attract long-term investors suggests it may continue to outperform in the future. As the market continues to evolve, all eyes will be on Ethereum to see if this upward trend can continue into 2025 and beyond.