The decisive driver for ETH remains US monetary policy. Citi highlighted two potential outcomes:
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a Fed rate cut could send Ethereum toward $6400;
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a rate hike could push the asset down to $2200.
Analysts stressed that network activity continues to play a major role in Ethereum’s valuation. Yet, most of the on-chain growth has been concentrated at the Layer-2 level, where the direct value transfer to the base chain is still uncertain.
Currently, only around 30% of L2 activity is reflected in Ethereum’s pricing. Citi notes this points to an overvaluation, likely fueled by heavy ETF inflows and the ongoing hype around tokenization and stablecoins.
The bank’s researchers also expect momentum in ETH ETFs to slow. Compared to Bitcoin, Ethereum has a smaller market cap and lower recognition among new retail investors, limiting further fund flows.
According to SoSoValue, Ethereum ETFs recorded $637 million of inflows in the past trading week.
Other macroeconomic factors are expected to offer only limited support. With equities already close to Citi’s S&P 500 target of 6600 points, analysts do not anticipate major upside in risk assets.
At the time of writing, ETH is trading near $4495, posting a 4.4% gain over the week.
Earlier, FORECK.INFO reported on institutional demand and technological upgrades as key drivers behind ETH/USD growth.