There’s an emerging sense that the Securities and Exchange Commission (SEC) will reject applications for spot ethereum exchange traded funds next month, but there are still plenty of avenues through which the second-largest cryptocurrency can appreciate.
Some good old fashioned, large-scale buying could be all that’s needed to propel ethereum’s current market capitalization of $421.1 billion to the upside. Data indicate some of that buying already materializing. Recent data from Lookonchain and Spot On Chain revealed ethereum transfers totaling north of $205 million over the past several days.
“After ETH’s slight increase on Thursday, large ETH whale Ox347 deposited 9000 ETH tokens to Binance at $3,560 in a bid to book profits, according to onchain insights from Spot On Chain. Although this is the whale’s largest ETH deposit to date, its address still holds 29,738 ETH worth a whopping $106 million with an estimated profit of $68.5 million,” reported Michael Ebiekutan for FX Street.
While some of those transactions are sales/profit-taking, other on-chain data points confirm the entry of sizable buyers in the ethereum market, indicating there could be bullish near-term prospects for the digital currency.
Why It’s Important
As cryptocurrency has become more of an investable asset class, savvy traders have increasingly paid attention to “whale buying”, particularly when it pertains to bitcoin and ethereum.
In the case of the latter, there are expectations that if large-scale purchases continue over the near-term, ethereum could clear the technically important $3,678 price point. From there, some experts believe the cryptocurrency could notch a 22% surge.
“The critical neckline of this pattern stands at $3,678. Should Ethereum break through this level, analysis indicates a potential surge of around 22% to the $4,400 mark. However, ETH might face resistance near the $4,100 level, where it formed a local top in March,” according to Be In Crypto.
As noted above, some ETF and crypto experts believe the SEC isn’t going to sign off on spot ethereum ETFs next month, indicating that recent whale buying is encouraging. After all, those large ether bulls are almost certainly aware of the headlines suggesting spot ether ETFs won’t become near-term realities in the U.S. Yet, they’re still establishing long positions in the cryptocurrency.
That could be a positive signal for ETFs such as the VanEck Ethereum Strategy ETF (EFUT) and the Bitwise Ethereum Strategy ETF (AETH), both of which provide exposure to ethereum futures contracts.
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