The price of Ether has nowhere to go but up, according to an analyst, with 40% of Ether now out of circulation amid record institutional demand.

“Ethereum has never experienced a market cycle with all three supply vacuums active at once,” said analyst ‘Crypto Gucci’ on Tuesday.

Crypto Gucci noted that digital asset treasuries (DATs) did not exist in the last market cycle. Over the past few months, DATs have amassed a whopping 5.9 million ETH, worth around $24 billion and equivalent to 4.9% of the total supply, according to StrategicEthReserve.

These entities will hold the asset for long-term yields.

Spot Ether exchange-traded funds were also absent in the last cycle.

As of today, US-based ETFs have scooped up 6.84 million Ether (ETH) worth $28 billion, and equivalent to 5.6% of the total supply, despite staking not being approved.

Finally, while staking was in its infancy during the last market cycle, today there is 35.7 million ETH staked, worth approximately $146 billion, and accounting for almost 30% of the entire supply. Most of this is illiquid due to the length of the exit queue, which currently stands at 40 days.

Crypto Gucci stated that Ether has entered this cycle with record institutional demand and the smallest liquid float in its history.

“When demand meets a shrinking supply like this, price doesn’t just go up, it goes nuclear.”

“With institutional bidding and [ETF] staking approval, I think ETH will rally hard,” said entrepreneur Ted Pillows earlier this week. He predicted a fair value of $8,000 to $10,000 this cycle.

Nation-states next?

Another factor that could become a fourth supply vacuum would be if nation-states started stockpiling Ether for their crypto strategic reserves.

This week, the Kingdom of Bhutan announced that it was building on Ethereum by integrating its national ID system on the blockchain. However, it does not currently hold any ETH.

“It’s awesome that Bhutan is building on Ethereum,” said Ryan Sean Adams from Bankless. “But if Ethereum can’t convert building on Ethereum to holding ETH as a store of value, it’ll never live up to its cypherpunk dreams,” he added.