The price of Ethereum has steeply declined after a big withdrawal from Grayscale’s Ethereum Trust.
In the last two days, $113.3 million moved out of just-licensed spot Ether ETFs on the US market, with Grayscale taking out 9% of its initial holdings from the Ethereum Trust.
One ethereum coin was selling for $3,185.46 at press time, which amounted to a loss of 7.56%.
However, yesterday an inactive “whale” that holds $3.3 million came back indicating there could be some market moves while Grayscale transferred over $1 billion worth ETH to Coinbase earlier this week amidst the hype about spot ETH ETFs being approved.
The price of Ethereum (Eth) fell as a result of this development and its impact on the market.
This led many to hope that there would be increased demand for Ethereum following SEC’s decision to approve spot ether ETFs on July 24th.
However, large sums are leaving the market; therefore it is possible that they may be adjusting their positions or moving assets in preparation for fluctuations in the markets.
And net outflow was more than $113 million for second trading day indicates an ongoing cautious stance taken by investors.
Another factor contributing to downward pressure on prices is dwindling Eth liquidity across exchanges with last year’s low breached at 20.8 million ETH.
According to Nansen dashboard within past seven days alone more than 491k ETH have been taken off exchanges equivalent to almost $1.7bn pointing towards significant dip in liquidity
As such pattern implies that either investors transfer their funds into cold storage for long-term safekeeping or reposition them elsewhere within cryptocurrency space. Nonetheless, over short-term negative sentiment concerning this issue does not change historically significant progress made by way of approval by Securities and Exchange Commission (SEC) regarding EETH.
ETFs Linked to Ethereum Approved by SEC
Many were expecting a boost in Ethereum’s demand following the approval of spot Ether ETFs by SEC on July 24.
However, with money being pulled out from the market, they may be rebalancing their portfolios or moving assets around ahead of market volatility.
This hints at an overly cautious stance that investors are currently taking since over $113 million was withdrawn just after its second trading day.
Apart from this, there is a lack of eth liquidity across exchanges which is further dragging prices down. 20.8 million ETH previous year low has been crossed.
In the past week alone, more than 491k ETH worth nearly $1.7bn have left exchanges according to Nansen dashboard signifying significant decrease in liquidity
Hence, this pattern shows us that either people transfer their funds into cold storage intending to keep it for long periods or repurpose them elsewhere within crypto market. Yet despite the short-term bearish attitude, this is a historic step towards the transformation of market dynamics in future due to approval of Eth ETFs.
Despite mixed reactions from markets early on during inception phase, quite a number of experts remain optimistic about Ethereum’s prospects. This has led some predictions to claim that more institutional investors might buy ETH and sees its price skyrocketing up to $9,600.
It would appear as though major players are frantically readjusting their position plays as evidenced by Sec approval for Eeth etfs.
#ETH_ETFs_Trading_Today #ETH_ETFs_Approval_Predictions #ETH #ETHUSDT $ETH