Ethereum whales gear up for potential ETF approval, amid market divergence  |  Editor Rachael Rajan

Published Sep 27, 2023 06:00

On Tuesday, Ethereum whales and institutional investors have been strategically positioning themselves in anticipation of the upcoming approval of the Ethereum futures Exchange-Traded Fund (ETF), set for October 2, 2023. These large-scale holders of Ethereum, whose actions often significantly impact the market, have been accumulating more tokens during recent price declines, indicating their optimistic outlook on Ethereum's future prospects.

Ethereum options' open interest on the Chicago Mercantile Exchange (CME) has reached an all-time high of $352 million, reflecting active participation from institutional investors. This surge in interest is seen as a signal of confidence and anticipation for positive outcomes following the ETF approval.

Recent data revealed a notable spike in whale transactions during a recent market dip. This buying activity suggests that Ethereum whales capitalized on the price decline to accumulate more tokens. The supply distribution of Ethereum addresses also shows an increase in the number of Ethereum whales holding between 100,000 to 1,000,000 ETH from 19.1 million on August 19 to 20.19 million as of September 24.

On September 12, when Ethereum experienced a significant decline to $1,551, there was a pronounced surge in whale transactions exceeding $100,000 in value. This indicates a strong inclination towards asset accumulation among these major players.

However, on-chain analysts at Santiment have noted divergences in the crypto market that may have resulted in a temporary halt in Ethereum's growth. Following the successful completion of Ethereum's Shapella upgrade, the altcoin rallied to the $2,100 level before its recent pullback. Analysts conclude that market participants' risk appetite is relatively low based on the behavior of large wallet investors.

One critical divergence observed by experts is between the trade volume and price of Ethereum. These divergences are indicative of declining risk appetite among traders. CrymeaCOIN, an expert analyst and trader, assumes that the Ethereum price will continue forming lower highs and considers the ETH/BTC price chart as an ideal spot for redistribution.

While the exact impact of the ETF approval on Ethereum's price remains uncertain, market participants are preparing for heightened volatility and increased trading activity. This event represents a significant milestone for Ethereum and the broader cryptocurrency market, potentially paving the way for further institutional adoption and market growth.

This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.

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