After struggling for months, Ethereum finally broke the $4,000 barrier on Dec. 7 on the back of increased accumulation from retail investors.

Ethereum (ETH) touched a local high of $4,100 over the weekend and has been consolidating close to that level over the last two days. The leading altcoin faced a mild 0.8% correction in the past 24 hours and is trading at $3,950 at the time of writing. 

The asset’s market cap is hovering at $475 billion. Ethereum recorded a 21% rise in its daily trading volume to $24.5 billion.

Ethereum’s price surge came as investors accumulated over $1 billion worth of ETH over the past week, according to data provided by the analytics platform IntoTheBlock. The largest exchange net outflow of almost 104,000 ETH came on Dec. 4

The large holder-to-exchange net flow ratio, currently at negative 0.65%, suggests that retail investors have been more active than whales, per ITB data.

Data from ITB suggests that the Ethereum large holder inflows plunged to a one-month low of 197,160 ETH on Sunday — bringing a net outflow of 4,550 ETH from whale addresses. This movement usually indicates a whale selloff, potentially triggering a short-term correction.

Moreover, the whale transaction volume consisting of at least $100,000 worth of ETH also plunged from $17 billion to $4.8 billion between Dec. 6 and 8, according to data from ITB. 

One of the key catalysts for Ethereum’s rally to the $4,000 zone was the spot ETH exchange-traded funds in the U.S. These investment products recorded a net inflow of $836.8 last week.

Ethereum’s decentralized finance sector also recorded strong growth. The ETH DeFi total value locked reached $77 billion on Monday for the first time since April 2022, per data from Defi Llama.

What’s next for Ethereum? Depends on the data you’re looking at.

The declining whale activity could trigger FUD (fear, uncertainty and doubt) among retail investors, potentially initiating a correction before another major run.

Crypto Rover, a prominent crypto analyst and influencer, pointed out the similarity between the Bitcoin (BTC) breakout to the $100,000 mark and Ethereum’s current price action.

https://twitter.com/rovercrc/status/1865787671987339352

While the ETH and BTC price movement over the last four years looks similar, investor sentiment and macroeconomic changes could push the volatile crypto market in unexpected directions.