Ethereum has been experiencing pressure lately, with a significant drop of about 15% from March 2024. Despite this decline, on-chain data suggests a positive outlook.
A spike in Ethereum demand has been observed, particularly from long-term holders, who are likely institutional investors with the financial capacity to hold onto their assets. Unlike retail investors, these institutions are more resilient to market volatility and are able to hold for extended periods.
According to CryptoQuant data, these long-term holders made a significant purchase of 298,000 ETH on June 12, marking the second-highest daily acquisition. This influx of Ethereum into the market indicates a strong bullish sentiment, even amidst the current downward trend.
It is speculated that institutions such as hedge funds and billionaires are taking advantage of the lower prices to establish positions in the market. The recent weakness in Ethereum, as shown in the daily chart, indicates that sellers are still active, potentially leading prices back to previous lows.
The daily chart also reveals that $3,700 is acting as a resistance level for Ethereum, with the price falling to fill the gap from May 20. If the downward trend continues, Ethereum may retest the $3,300 level.
In other news, Gary Gensler, the chair of the United States Securities and Exchange Commission (SEC), mentioned in a senate hearing that spot Ethereum exchange-traded funds (ETFs) may start trading in the summer. Approval of these ETFs could bring significant liquidity to Ethereum, attracting institutional investments similar to spot Bitcoin ETFs.
The market sentiment remains positive, with anticipation surrounding the potential launch of spot ETFs for Ethereum. If approved, these ETFs could open up new opportunities for investors and further establish Ethereum as a key player in the cryptocurrency space.
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In conclusion, the recent surge in Ethereum demand from institutional investors and the potential launch of spot ETFs signal a promising future for the cryptocurrency. With expert analysis and market insights, investors can stay informed and make well-informed decisions in this ever-changing landscape.