Ethereum is also following Bitcoin’s path following the approval of a spot BTC ETF earlier this year.
The spot Ethereum ETF successfully launched on Tuesday, with inflows of over $107 million, but the ETH price is under selling pressure and is down 1.1% at the time of writing, nearing the $3,450 level.
However, on-chain metrics suggest that Ethereum whale activity remains high, suggesting that any downside could be limited going forward.
According to on-chain data from IntoTheBlock, despite the ETF price drop yesterday, large holders have accumulated 112.9k ETH, raising a whopping $390 million. This accumulation significantly exceeds the $106 million net inflow into Ethereum ETFs, showing that demand for Ethereum is absolutely strong among large market participants at the moment.
Likewise, on-chain data analytics platform Santiment reported that the introduction of a spot Ethereum ETF had a significant impact on whale activity last week. Since July 17, the number of ETH transfers exceeding $100,000 has increased by 64% compared to BTC transfers and by 126% compared to USDT (ETH-based) transfers.
🐳 Whale activity is clearly being affected by the launch of 9 new spot ETFs on Ethereum. Since July 17, ETH transfers exceeding $100K are +64% higher than BTC transfers and +126% higher than USDT (ETH equivalent) transfers. 🤯 pic.twitter.com/SnLem6ko5G
— Santiment (@santimentfeed) July 23, 2024
Ethereum price movement continues
According to reports, Ethereum is also following the same trajectory as Bitcoin following the approval of the Spot BTC ETF earlier this year. The Bitcoin price surge actually began in February, as investors ultimately settled in after Grayscale outflows and BlackRock inflows. Popular crypto analyst Michael van de Poppe writes:
“If the market follows the price action of the Bitcoin ETF, there is likely to be some selling due to the Grayscale trust outflow. The downside momentum will take a week or two before Ethereum really surges towards new all-time highs.”
According to the chart below shared by Poppe, Ethereum could drop to $3,150 before resuming its uptrend.
Photo: Poppe / TradingView
It will also be interesting to see how long Ethereum ETF inflows continue to build confidence among investors.
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