The leveraged short position for Ethereum on the CME has reached a record high, indicating a bearish sentiment in the market. This comes as open interest in Ethereum futures on the CME hits a record high of over one million ETH. While open interest in Ethereum has increased across all exchanges, the heightened short positions raise concerns about the ETH price. Speculation suggests that institutional investors, such as hedge funds, are shorting ETH on the CME as a basis trade. However, these leveraged short positions pose a risk of massive liquidation if the price of ETH rises unexpectedly. Despite the record short positions, analysts believe that ETH will rise in value and point to on-chain signals to support this claim. Demand for Ethereum is increasing, particularly through exchange-traded funds (ETFs), which have seen significant inflows. The accumulation of ETH is driving its upward movement in price. Predictions for ETH in 2025 range from $6,000 to $7,000. Maintaining a price above the important support level of $3,700 will be crucial for ETH's performance. Additionally, ETH supply has become deflationary as the average daily burn rate has increased, leading to expectations of further price increases. Overall, network activities for Ethereum are trending up, with increased new wallets and active addresses on the network.



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