Technical Analysis Behind the #ETHRally of 2025
The current #ETHRally, observed with enthusiasm by the crypto community in Rio de Janeiro and around the world, is a phenomenon that, from a technical perspective, goes far beyond simple market speculation. It is driven by a confluence of on-chain factors and market structure that have created a scenario of strong upward pressure for Ethereum (ETH).
1. The "Supply Shock" Dynamic:
Technically, the main driver of the rally is a drastic reduction in the net supply of ETH available for trading. This occurs through two avenues:
Deflationary Burn (EIP-1559): The intense activity in the Layer 2 (L2s) ecosystem and in DeFi applications on the mainnet results in a high volume of transaction fees. A significant portion of these fees is permanently "burned," removing ETH from circulation at a rate that, at many times, exceeds the issuance of new tokens, making the asset effectively deflationary.
Massive Staking and Restaking: A record percentage of the total ETH supply is locked in staking contracts (through platforms like Lido) and, more recently, in "restaking" protocols like EigenLayer. These tokens are removed from the circulating market to secure the network and other protocols, further decreasing the supply available on exchanges.
2. The Institutional "Demand Shock" via ETFs:
As net supply decreases, demand has increased exponentially through a new and powerful vector: spot Ethereum ETFs. Approved at the end of 2024, these financial products have become the primary channel for institutional and traditional retail capital to gain regulated and secure exposure to ETH. Consistent and significant inflows into these ETFs have created constant and massive buying pressure in the market.
Technical Conclusion:
The #ETHRally of 2025 is the result of a classic "squeeze" of supply and demand, but on an unprecedented scale. Technical analysis shows that this is not just a price movement, but the validation of Ethereum's "Ultrasound Money" thesis: an asset with programmatically scarce (and often deflationary) supply.
Finding a new wave of massive and passive institutional demand. The breakout of historical resistance levels is the natural consequence of this fundamental dynamic.$ETH
