Ultra Sound Money Loses Momentum, But Ethereum Displays Strength in Technical Analysis

The narrative of ultra sound money, which was central to Ethereum’s value proposition for years, is beginning to lose traction. The total supply of ETH has reached all-time highs, and the staking rate has dropped 1% since November. However, analysts warn that these supply-side challenges don’t tell the whole story. Recent data suggests that strong demand factors could drive an upward move, even as the ultra sound money narrative fades from mainstream discourse.

Institutions massively accumulate during the dip

Large institutions recently took advantage of volatility to increase their positions. BlackRock, one of the world’s largest asset managers, holds 100,535 ETH valued at approximately $276 million. Cumberland has accumulated 62,381 ETH worth $174 million, and World Liberty Financial has continued buying during market pressure.

In just one week, whales holding between 10,000 and 100,000 ETH acquired over 600,000 ETH, absorbing much of the selling pressure. This institutional behavior is crucial because it shows that major players see value at current prices, regardless of the macro narrative.

On-chain data reveal investor confidence

Santiment data show a significant shift in investor behavior. Currently, 9.63 million ETH are stored in exchange wallets, worth $26 billion. This is the lowest level recorded since August 2024, indicating a massive withdrawal of assets from trading platforms.

When investors withdraw their cryptocurrencies from exchanges, it typically reflects confidence in the asset and reduces available selling pressure. Less liquidity on exchanges means less risk of sharp declines and more room for sustained recoveries.

Technical metrics indicate potential undervaluation

CryptoQuant analysis highlights that Ethereum’s realized price—the average purchase cost for all holders—is around $2,200, while the current market price hovers near $2,290. This gap narrows the safety margin but acts as a potential support level.

The MVRV ratio (Market Value to Realized Value) just exceeds 1, suggesting that Ethereum could be significantly undervalued historically. The number of long-term holders accumulating without selling is rapidly increasing, a pattern that mirrors Bitcoin’s behavior.

Futures market selling pressure has also decreased markedly. Selling volumes are even below those seen during the decline from the previous year’s peak of $4,950, indicating a gradual absorption of liquidations at lower prices.

Bitcoin factor determines upcoming moves

Analysts warn that Ethereum’s future trajectory will heavily depend on Bitcoin’s stability and recovery. However, recent CoinShares data offer a glimmer of hope: Ethereum led crypto product inflows in the first half of 2025, attracting nearly $800 million in weekly flows—almost double the $407 million directed toward Bitcoin-related products.

This shift in institutional capital flows suggests that the market is recognizing Ethereum’s potential beyond the weakened ultra sound money narrative. While macroeconomic uncertainties may continue to generate price volatility, the underlying fundamentals point toward promising long-term growth potential.

Disclaimer: The information provided in this article is for educational purposes only and should not be considered financial or legal advice. Always conduct your own research or consult a professional when dealing with cryptocurrency assets.