- Ethereum surged above $3,850 following the SEC’s approval of the Ethereum ETF, with top investors accumulating 510,000 ETH worth nearly $2 billion in five days.
- As ETH ETFs are expected to attract significant institutional inflows, Ethereum faces a critical resistance at $4,200, with potential to reach new highs above $5,000.
Whales Invest $2 Billion Following ETF Approval
Ethereum (ETH) has been making waves in the cryptocurrency market, recently surging above $3,850 on May 26. This price movement has sparked hopes of another bullish week ahead. The top 1,000 Ethereum wallets have accumulated an impressive 510,000 ETH within just five days following the approval of the Ethereum ETF. With investors eagerly awaiting the influx of funds into these newly-approved spot ETFs, the next significant resistance level at $4,200 now presents a critical challenge.
Ethereum ETF Approval Sparks Market Excitement
On May 23, the US Securities and Exchange Commission (SEC) approved the spot Ethereum ETF for trading in US regulated markets, sending shockwaves through the crypto markets. This approval has set the stage for a potential surge in ETH prices, as institutional investors are expected to pour billions into these ETFs. The approval news led to an initial 29% three-day rally, pushing ETH to a 40-day peak of $3,945 before briefly retracing to $3,556. Swing traders capitalized on the market excitement to book early profits.
However, the bullish sentiment quickly regained momentum over the weekend, with ETH prices surging by 9% to reclaim the $3,850 territory by May 26. This resurgence can be attributed to the widespread expectation that ETH ETFs will receive significant inflows in their first full week of trading.
Whales Position for the Next Bull Run
Notably, the 10 approved Bitcoin ETFs accumulated over $58 billion worth of BTC holdings within five months of their launch in January 2024, with $10 billion coming in the first month alone. Many crypto investors now anticipate that ETH will see a similar demand from institutional investors.
To get ahead of the anticipated upside from billions of expected inflows when ETF markets open on Monday, May 27, the largest Ethereum investors have been making significant purchases since the ETF approval. On-chain data reveals that the top 1,000 Ethereum wallets increased their holdings from 76.01 million ETH on May 19 to 76.52 million ETH by May 26. This rapid accumulation, valued at around $1.95 billion, reflects the strong confidence among whales in the future price appreciation of Ethereum.
$5,000 on the Horizon?
With ETH currently trading at $3,855, up 6% over the weekend, the added market liquidity and long-term holding tendencies of whale investors could push Ethereum towards new all-time highs. The next significant resistance level is around $4,200, where 9.7 million active addresses previously acquired 3.5 million ETH. If bulls can overcome this resistance as ETF inflows begin, a parabolic price breakout to above $5,000 could be on the cards for June 2024.
Moreover, the approval of Ethereum ETFs in Hong Kong earlier this year could also attract substantial inflows from Chinese investors, further fueling the bullish momentum. As the market continues to evolve, all eyes are on Ethereum to see if it can reach new heights in the coming weeks.
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