Key Insights on Ethereum’s Recent Surge

• Ethereum (ETH) has seen a 50% increase in just two weeks, with projections suggesting it could hit $9,000 by early 2026.

• The on-chain fundamentals show strong signs: 28% of ETH are currently staked, and exchange balances are at their lowest since 2016, indicating a growing influx of new buyers.

• Network usage remains nearly at capacity, even with multiple increases in block gas limits, pointing to sustained demand.

Recently, Ethereum (ETH) jumped 50%, regaining attention from investors following a challenging period. However, at $3,730, it still sits 23% below its peak from November 2021. Some analysts are even suggesting price targets that could more than double its current value.

For the second-largest cryptocurrency, the question remains: is the best yet to come? Trends in on-chain data, transaction flows, and blockchain activity suggest that this rally might just be starting.

ETH May Be Underappreciated

Despite recent gains, ETH seems a bit out of sync with the overall market sentiment. As per GlassNode, the MVRV Z-Score—which compares Ethereum’s market cap with its realized cap—is notably lower than its peak cycle value. ETH isn’t in the “bearish” range anymore, but it still hasn’t reached the euphoric heights often seen during market booms.

When you compare it to Bitcoin, ETH still has a lot of catching up to do. Over the past year, Bitcoin surged 74%, while ETH dropped 28%, widening the performance gap. Some analysts, like the Bitcoin Vector Analyst, suggest that ETH is in a “catch-up mode.” It seems there might be a rotation happening.

The $4,000 level is likely to be an important psychological and technical threshold. If ETH breaks through it, many believe it could lead to further acceleration in its price.

One viewpoint comes from the Elliott Wave analysis approach, which posits that market prices move in predictable five-wave patterns. According to Xforceglobal, which shared an analysis a month ago, ETH appears to be building momentum in its third impulse wave. If macro conditions stay favorable, we could see a peak around $9,000 by early 2026, potentially marking Ethereum’s next major breakout before the next market downturn occurs.

On-Chain Indicators Show Strengthening Demand

On-chain metrics indicate that the bullish outlook for ETH isn’t just speculative but rooted in structure.

As it stands, over 34 million ETH, or 28% of the total supply, are currently staked. This locks up capital for the long term, reducing available supply and emphasizing strong belief from investors.

The remaining supply isn’t particularly liquid either, as exchange balances have fallen to their lowest since 2016, now at 16.2 million ETH. This reduced liquidity from sellers generally supports upward price movements, especially when coupled with rising demand.

It looks like this demand is on the rise. GlassNode reports that new buyers in the market have increased by around 16% since early July, indicating growing interest from fresh market entrants. Analysts from GlassNode view this as an initial sign of a potential trend reversal.

In addition to on-chain metrics, there’s been a noticeable increase in spot ether ETFs, surpassing $4 billion in the past two weeks.

Currently, about 94.4% of the ETH supply is in a profitable position. Interestingly, the sentiment among investors seems relatively subdued; GlassNode’s NUPL indicator stands at 0.47 for ETH, labeled as “optimistic/anxiety.” This is lower compared to Bitcoin and Ripple, which are reading at 0.57 and 0.62, respectively. This suggests there’s still growth potential before the investors start to feel euphoric.

Ethereum Activity and Demand Trends

Beyond speculation, the actual utility of ETH is growing in subtle yet significant ways.

Currently, average trading fees have dropped to a historic low of 0.0004 ETH per transaction, but that doesn’t imply a decrease in activity. In fact, it may reflect greater efficiency, particularly as many transactions are now processed on Layer 2. It can be misleading to judge network demand solely based on fee structures; gas usage gives a clearer view of the work actually being consumed.

As Ethereum works to enhance scalability, block gas limitations have seen consistent increases recently, with the latest adjustments made in July 2025 following earlier increments in previous years. This indicates that demand has been there, patiently waiting to be tapped. Early signs from the recent upgrades suggest this trend will continue, with Ethereum operating near full capacity and demand springing up as soon as new room is created.

However, the nature of transactions is shifting. NFTs, which dominated Ethereum’s block space in 2021, now represent a smaller portion, and the DeFi scene has cooled. Instead, there’s a growing focus on a broad category of decentralized applications. Transactions involving stablecoins and standard ETH transfers—simple value movements from one address to another—are rising as well, reflecting increased settlement and trading activities consistent with the emerging bull market.

This article does not offer investment advice or recommendations. All trading carries risks, and readers should conduct their own research before making decisions.