Key points:

Ethereum holders are back in profit, increasing chances for a rally to $3,000 and beyond.

Ether sell pressure risk exists at $2,800, where 2.27 million ETH could be sold.

Ether’s recent surge to $2,700 on May 14 pushed its value above its realized price, implying that the average holder of ETH is “now back in an unrealized profit,” according to Glassnode.

Ethereum trades above its cost basis

Data from Cointelegraph Markets Pro and TradingView shows that Ether’s (ETH) price has risen by more than 52% to a three-month high of $2,700 on May 14 from $1,800 on May 7, fueled by excitement around the Pectra upgrade.

This rally has seen ETH rise above its realized price or cost basis, currently at $1,900, paving the way for a potential rally to $3,000 or higher. 

ETH holders returning to profit after unrealized losses “provides meaningful financial relief for many holders, signaling a bullish outlook,” Glassnode explained in its latest report.

Historically, during the early phase of a rally, holders in profit provided upward momentum by holding firm and attracting new investors. 

Further analysis of the cost basis of active market participants indicated the “strength of this upward move” as the price moved above its True Market Mean, or the Active-Investor Price,  at $2,400. This indicates fresh capital inflows into the market at higher prices. 

As Cointelegraph reported, holding above $2,400 was crucial to ensure a potential $3,000 retest.

Ethereum: Key pricing levels. Source: Glassnode

Despite Ether’s recent outperformance, Glassnode analysts noted that the Active Realized Price still sits overhead around $2,900 and remains a key level that must be “decisively reclaimed to support continued improvement in investor confidence” in the altcoin.

The market intelligence firm added:

“The $2,400–$2,900 range remains a crucial area for Ethereum, acting as both a resistance zone and a potential breakout level essential for maintaining upward momentum.”

Popular trader Daan Crypto Trades also said that ETH price must “convincingly break” out of the $2,400-$2,600 range before rising higher to confront high-timeframe resistance between $2,800 and $2,850. 

“Not looking to do much until we at least convincingly break out of this local range.ETH/USD four-hour chart. Source: Daan Crypto Trades

2.27 million ETH at $2,800 could trigger a sell-off

According to Ether’s cost basis distribution data, investors hold approximately 2.27 million ETH at an average cost basis of $2,767, creating a potential resistance zone. This concentration suggests many investors may sell at break-even, potentially stalling Ether’s upward momentum.

Ethereum cost basis distribution chart. Source: Glassnode

From a technical perspective, ETH must flip the $3,000 resistance level into support to target higher highs above $4,000.

But first, the ETH/USD pair must close above the $2,600-$2,800 range, where the 100-day and 50-day simple moving averages (SMA) currently sit. ETH price dropped below this level in February, driven by risk-off sentiment following Trump’s tariff measures. 

ETH/USD weekly chart. Source: Cointelegraph/TradingView

​​One positive catalyst for the bulls could be continued demand from spot Ethereum ETFs. Ether ETFs registered $100.7 million in net inflows in the last three days, per Farside Investors’ data.

Meanwhile, the bears will attempt to keep the $2,600 resistance in place to increase the likelihood of pulling the price lower. The immediate target is below the $2,400 level, or the 200-day SMA.

Below $2,400, the next key area of interest remains between $2,200 and the psychological level at $2,000. Reaching $1,800 would erase all the gains made after the Pectra upgrade.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Key takeaways:

The Bitcoin Quantile Model shows “heat” with price on the verge of an “acceleration phase,” echoing Q4 2024 when BTC embarked on a 45% post-election rally.

Bitcoin (BTC) price has formed a new intraday high on each daily candle this week, with the crypto asset slowly grinding toward a new all-time high. In line with its current trajectory, 21st Capital co-founder Sina noted that Bitcoin is approaching a pivotal moment around the $108,000 level. 

The Bitcoin Quantile Model update shows that BTC’s market reflects the same “heat” that was present after President Trump’s post-election rally and the spot ETF-driven highs during Q4 2024. The model, which uses quantile regression to map Bitcoin’s price phases on a logarithmic scale, indicates the cryptocurrency is in the Transition Zone, a critical juncture before the Acceleration Phase. Throughout Q4, 2024, Bitcoin rallied by 45% after entering a price discovery period above $74,500. 

Bitcoin Quantile Model. Source: X.com

As illustrated in the chart, once it breaks into the “Acceleration” Phase, it could trigger BTC’s next leg or the mid-phase, typically between the 33% and 66% range. Based on the model, BTC is expected to progressively target price levels of $130,000 and $163,000 in the coming months. 

However, anonymous Bitcoin analyst apsk32 believed a price target above $200,000 is a “reasonable” expectation for 2025. Basing the projection on Bitcoin’s “power curve,” the analyst noted that BTC’s position relative to gold has significantly improved since April. 

From a technical standpoint, this view is supported by the recent convergence of the Sharpe ratios for Bitcoin and gold, suggesting that the two hard assets now offer comparable risk-to-reward profiles to their investors. 

Fidelity’s Director of Global Macro Jurrien Timmer shed light on this development, recommending a 4:1 goal-to-Bitcoin ratio from an allocation perspective. 

Related: Bitcoin ‘blow-off top’ set at $128K with new all-time highs in sight

Strong Bitcoin volumes “final straw” before new highs 

Crypto researcher Aylo analyzed BTC’s historical price action when the crypto asset consolidates near its all-time high level. In an X post, the analyst explained, 

“The data shows when BTC gets close to its previous ATH during a strong, accelerating trend with high momentum, it has historically broken out to new ATHs within a short time (days to weeks).”

However, weaker trends have led to stalls or retraces between March and May 2024. Currently, Bitcoin exhibits a strong trend but lacks the necessary trading volume, which remains the final straw to confirm a breakout, a factor that could delay upward movement.

Alyo added that for Bitcoin to break its all-time highs, daily trading volume should exceed the previous 10 days, be at least 1.5 times the 20-day average, and ideally sustain a 3-day increase while the price holds steady or rises.

Data from CryptoQuant has reinforced Aylo’s concerns about trading volume. On May 21, retail investor demand for Bitcoin, defined as wallets buying/selling between $0 and $10,000, remained low at just 3.2% over 30 days, despite BTC trading within $2,000 of its all-time high.

Bitcoin’s retail investor volumes. Source: CryptoQuant

For comparison, bullish retail demand accounted for approximately 30% in December 2024—nearly 10 times higher than current levels—even though Bitcoin was well below, at a price range of $96,000 to $97,000.

Related: How high can Bitcoin price go?

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

America’s powerful banking lobby is “panicking” over the potential of stablecoins to disrupt their traditional business model, particularly when it comes to yield-bearing stablecoins, according to Austin Campbell, a New York University professor and founder of Zero Knowledge Consulting.

In a May 21 social media post that begins with, “The Empire Lobbies Back,” Campbell claimed that the banking industry is especially alarmed by the potential for stablecoins to offer interest or rewards to holders. 

In a pointed message aimed at Democratic lawmakers, Campbell wrote that “banks want you to protect their cartel so they can keep screwing your voters.”

He went on to explain how fractional reserve banking enables banks to maximize profits while offering depositors minimal interest.

The banking lobby says that if stablecoins pay interest or any other type of monetary reward, banks will be “harmed,” Campbell added.

An excerpt of Campbell’s X post. Source: Austin Campbell

“This is naked pandering for cartel protection,” he said while urging the opposition party to avoid “screwing” its voters with supporting any type of blanket ban on stablecoin interest payments.

Campbell has long advocated for sensible stablecoin legislation in the United States, warning a Congressional subcommittee in April 2023 that failing to enact such laws would push issuers overseas.

Related: Pareto launches synthetic dollar backed by private credit

The rise of yield-bearing stablecoins

Campbell’s scathing assessment of the traditional banking industry comes amid a wave of stablecoin issuers launching yield-bearing tokens. 

As reported by Cointelegraph, the US Securities and Exchange Commission (SEC) in February approved the first yield-bearing stablecoin security by Figure Markets. At the time of its launch, the new YLDS token offered a 3.85% yield. 

Figure Markets’ Form S-1 registration with the SEC for its yield-bearing stablecoin. Source: SEC

Figure Markets is by no means the only player going down the yield-bearing stablecoin route. 

In February, Tether co-founder Reeve Collins announced that his Pi Protocol will allow investors to mint the USP stablecoin in exchange for USI, an interest-paying equivalent. 

Spark Protocol’s USDS also offers holders interest payments generated through decentralized lending and tokenized Treasurys. 

Stablecoins have come a long way since October 2014, when Tether launched USDt. Source: S&P Global

“It’s unacceptable to not be receiving at least the risk-free rate for holding stablecoins,” Sam MacPherson, CEO of Spark Protocol developer Phoenix Labs, told Bloomberg.

Aside from Bitcoin (BTC), stablecoins have arguably become the most impactful use case for blockchain technology, with Coinbase Canada CEO Lucas Matheson telling Cointelegraph that global stablecoin volumes are nearly three times those of credit card giant Visa.

Related: Canada lags with stablecoin approach, but there’s room to catch up