Ethereum (ETH) has recently experienced a surge in price, nearing the $4,000 mark. This increase in price has been met with renewed market enthusiasm following the US Securities and Exchange Commission’s (SEC) approval of Ethereum ETF applications by major asset managers. CoinShares reported a total of $2 billion in inflows to digital asset investment products, marking a five-week consecutive run of inflows amounting to $4.3 billion.
In addition to the influx of funds, trading volumes in exchange-traded products (ETPs) have also seen a significant increase, reaching $12.8 billion for the week. This represents a 55% rise from the previous week. The positive market sentiment has led to inflows across various providers, with a slowdown in outflows for incumbent providers.
Bitcoin (BTC) continues to dominate the market, with inflows totaling $1.97 billion for the week. However, short Bitcoin products saw outflows of $5.3 million for the third consecutive week. Ethereum has also seen a notable increase in inflows, recording its best week since March with a total of $69 million. This surge in Ethereum inflows is likely a reaction to the SEC’s decision to allow spot-based ETFs on Ethereum.
Despite the positive developments, Ethereum’s price has faced challenges in maintaining bullish momentum. The cryptocurrency failed to retest its yearly high of $4,100 reached in March and dropped to as low as $3,577 on Friday. However, there has been a 3% increase in Ethereum addresses holding more than 10,000 ETH in the past three weeks, indicating a spike in buying pressure.
Market analysts have provided varying perspectives on Ethereum’s future price action. Some, like “Trader Tank,” predict a drop to $3,500 but acknowledge the potential for a bullish reversal if the $3,700 level is reclaimed. On the other hand, crypto analyst Lark Davis highlights the low supply of Ethereum on exchanges, suggesting that the upcoming ETFs could trigger a “massive supply shock” and lead to a significant price increase for ETH.
As Ethereum’s price remains uncertain, investors and analysts are closely monitoring market dynamics. The question of whether the cryptocurrency will break above $4,000 or retest lower support levels at $3,500 is one that many are eagerly awaiting an answer to. The upcoming movements in the cryptocurrency market will undoubtedly be closely watched by all stakeholders.
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