Lark Davis Breaks Down Factors Driving Ethereum Price Towards $10,000
According to Lark Davis, a well-known crypto trader and analyst, Ethereum (ETH) is preparing for a massive rally on the way to 5-figure USD price.
In a recent video, the analyst shares with his 431K YouTube subscribers that the number two digital asset by market cap is getting ready to rise above $10,000, key fundamental factors indicate.
According to the trader, one of these indicators pointing to Ethereum’s massive rally is its falling supply in exchanges.
For a past year or so, Ethereum exchange supply has seen downtrend, as holders have taken their coins and either locked them in DeFi protocols or tied them in NFT purchases.
With the supply mechanics working as they are, it’s only a matter of time before the Ethereum supply crisis ends up jacking up the price in a serious way.”
According to a tweet by blockchain intelligence platform IntoTheBlock, the net amount of Ethereum exiting crypto exchanges recently reached a new record high.
The net amount of $ETH leaving exchanges just hit a new record
Over $1.2B worth of $ETH left centralized exchanges yesterday
“The net amount of Ethereum leaving exchanges just hit a new record. Over $1.2 billion worth of Ethereum left centralized exchanges yesterday. That is a mind-blowing number.”
The analyst also points out that when Ethereum worth over a billion dollars previously left centralized exchanges, the price of ETH jumped by double-digit percentage points within around four weeks.
“And what’s interesting, as IntoTheBlock points out, the last time that a billion dollars or more of Ethereum left centralized exchanges, Ethereum increased by 60% within 30 days.”
Another source that he quotes is blockchain analytics firm Glassnode. According to Glassnode data alarge amount of Ethereum’s supply has not moved within the last 90 days.
“87% of Ethereum supply has not moved on-chain for three months or longer. 87% of the supply! That is insanity.”
Davis says that the lack of movement is an indication that Ethereum holders are “waiting for higher prices,” driven by other factors, such as the burning of Ethereum transaction fees.
“People are holding for higher prices, they’re not selling below the previous all-time high. They know a new all-time high is coming. They know price discovery’s coming. They’re watching and seeing what is happening economically with Ethereum right now. They’re seeing how much, for example, Ethereum is being burned at the moment…
We have now had $1.1 billion worth of Ethereum burned away – 309,500 Ethereum at the time recording this video.”
Another bullish indicator is rapid increase of scaling solutions, known as layer-2 protocols, in Ethereum blockchain, Davis points out.
“We’re also seeing Ethereum layer-2s taking off now. In order to use Ethereum layer-2, you need to have Ethereum. Plain and simple. You have to have ETH to pay the gas fees on Ethereum layer-2.”
