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| Ethereum Whale Activity Rises, Ether ETF Performance in the Spotlight |
The highly anticipated launch of an Ethereum spot exchange-traded fund (ETF) did not generate the sustained upward momentum that many investors had hoped for.
Instead, Ethereum price has seen a slight correction since the fund launch last week and is now trading at US$3,300.
Despite the price drop, on-chain data revealed a large spike in Ethereum transactions, indicating whale activity reached a monthly peak.
Ethereum Whale Activity Surge
According to data from IntoTheBlock, activity among Ethereum largest investors increased significantly. Whale transactions, defined as transactions exceeding US$100,000, reached an extraordinary monthly peak on July 24, with 3.5 million ETH moved in a single day.
Crypto Globe reported that, this record was surpassed the following day when 3.68 million ETH, worth around US$12.1 billion, was moved in a single day. This excitement indicates a big movement of Ethereum whales in the market.
While the increase in whale transactions could indicate accumulation, the data tells a more complex story. Inflow or inflow to large wallets increased by 12.42 percent over the last week.
However, outflow has increased more significantly by 38.17 percent, resulting in a net outflow of 100.65 percent. This suggests that whales, as a whole, are removing Ethereum from trading platforms rather than accumulating more.
Ether Spot ETF Trading Volume
On the other hand, Ether spot ETFs saw a total trading volume of over US$360 million in just 90 minutes after their launch.
Bloomberg intelligence analyst Eric Balchunas highlighted that this trading volume places this ETF around 15th overall in terms of trading volume, placing it in the top 1 percent.
Balchunas noted that ETF launches typically see more than US$1 million in trading volume on the first day, but the spot Ether ETF greatly outperformed that benchmark, offering investors exposure to the performance of the second-largest crypto by market capitalization.
Additionally, the US Securities and Exchange commission (SEC) has raised the question of whether ETH should be classified as a security, while the Commodity Futures Trading Commission (CFTC) classifies Bitcoin and Ethereum as commodities. This regulatory uncertainty adds another layer of complexity to market dynamics.
Ethereum relies on a Proof-of-Stake (PoS) consensus algorithm, which allows holders to stake their assets to secure the network and earn yield on their holdings.
The SEC recently sued blockchain technology company Consensys for offering access to staked Ether on MetaMask, further highlighting the regulatory scrutiny surrounding Ethereum.
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