2025-01-21 14:43:22 by Finbold

Ethereum (ETH) appears to have found a powerful ally in World Liberty Financial (WLFI), a decentralized finance (DeFi) platform reportedly linked to U.S. President Donald Trump. In a buying spree just hours before Trump’s inauguration ceremony, WLFI acquired $48 million worth of ETH, drawing renewed attention to the cryptocurrency. The acquisition comes at a critical time when Ethereum is striving to overcome a period of underperformance, potentially marking a significant turning point in its trajectory. Picks for you Amid this surge in activity, market watchers are speculating on where Ethereum might head next as it rides a wave of renewed momentum. Ethereum one-day price chart. Source: FinboldAt press time, Ethereum is trading at $3,299.17, reflecting a 24-hour loss of 0.65%. However, on a weekly basis, the token has gained 2.8%, hinting at growing investor optimism. AI predicts Ethereum price amid WLFI buying spree To evaluate Ethereum’s potential trajectory, Finbold analyzed market trends and leveraged insights from OpenAI’s ChatGPT-4o model to provide a clearer picture of what lies ahead for the cryptocurrency. According to a recent Finbold research, ChatGPT is the most searched AI tool on Google, increasing its relevancy. The AI model suggests Ethereum could climb to $3,750 by the end of Q1 2025 in a bullish scenario driven by strong market momentum. However, in a bearish case marked by macroeconomic headwinds or tightening liquidity, the price could retreat to $3,000. Factors driving Ethereum’s price World Liberty Financial has emerged as a key catalyst for Ethereum’s recent momentum.  On January 20, WLFI acquired 14,403 ETH worth $48 million, increasing its total holdings to 58,853  ETH, according to Arkham Intelligence.  The platform also made a significant move across other assets, purchasing $109 million in digital currencies, including 177.26 Wrapped Bitcoin (WBTC) worth approximately $18.8 million in just hours. Adding to this bullish outlook, WLFI staked nearly 5,000 ETH, worth over $15 million, through Lido, signaling its long-term commitment to the Ethereum ecosystem. Derivatives data: A mixed bag Despite WLFI’s aggressive buying spree, Ethereum’s derivatives data paints a mixed picture. Long/short ratios on platforms like Binance point to strong bullish sentiment among traders, with options open interest climbing 1.85% to $8.18 billion.  However, the market shows signs of reduced activity, with trading volume dropping by 43.13% to $62.05 billion and open interest slightly declining by 0.48% to $31.35 billion.  Derivatives data. Source: CoinGlassAdditionally, liquidations over the past 24 hours, totaling $44.34 million in longs and $15.75 million in shorts, reflect a market that remains cautious, with recent movements favoring a reset in overleveraged positions. This combination of optimism and reduced activity suggests that while traders show confidence, broader participation, and higher volumes are needed to sustain a bullish narrative. Meanwhile, technical analysis indicates a bullish outlook, with Ethereum forming an inverse head-and-shoulders pattern, a classic signal for a potential breakout.  Adding to this, Michael Saylor, the executive chairman of MicroStrategy and a prominent Bitcoin advocate recently admitted to being wrong about Ethereum’s value proposition a statement that further fuels interest in the cryptocurrency. Ethereum price outlook Amid this backdrop, artificial intelligence models predict Ethereum could hit $3,750 by the end of Q1 2025, supported by WLFI’s sustained market activity. Ethereum price outlook. Source: ChatGPT/FinboldHowever, the model emphasizes the importance of increased trading volumes and broader market participation to maintain bullish momentum.  Conversely, in a bearish scenario marked by macroeconomic headwinds or reduced liquidity, Ethereum could retrace to $3,000. If WLFI’s activities inspire broader institutional adoption, Ethereum may be poised for a significant rally, with $3,750 as a near-term target. For now, market participants will closely watch whether Ethereum can capitalize on its newfound momentum. Featured image from Shutterstock