Ethereum Demand Skyrockets as Permanent Holders Snap Up 298,000 $ETH in Single Day

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As an analyst with a background in cryptocurrency market analysis, I find the Ethereum ($ETH) buying trend reported by Julio Moreno intriguing. The near-record accumulation by permanent holders comes amidst a wider market correction and price plunge below $3,500. This buying activity intensified after U.S. Securities and Exchange Commission (SEC) Chairman Gary Gensler’s announcement that Ethereum ETF applications could receive final approvals by the end of summer.

The demand for Ethereum ($ETH), the second largest cryptocurrency by market capitalization, reached one of its highest points ever recorded, with purchases amounting to 298,000 ETH or approximately $1.04 billion, during a single day. Permanent holders were responsible for this significant increase in accumulation.

I, as a researcher at CryptoQuant, recently pointed out on microblogging platform X (previously known as Twitter), that the daily Ethereum (ETH) buying volume came remarkably close to reaching the record high we witnessed last September. During that event, permanent ETH holders successfully accumulated approximately 317,000 tokens.

The interest in Ethereum has surged recently, as indicated by a large uptick in purchases from long-term investors, with a total of 298,000 Ether being bought on the previous day. This figure is only second to the record high of 317,000 Ether purchased back in September 11th.

— Julio Moreno (@jjcmoreno) June 13, 2024

Amidst a larger cryptocurrency market adjustment and following Ethereum’s price drop below the $3,500 threshold, a significant buying frenzy occurred, as reported by CryptoGlobe. Furthermore, they have noted ongoing Ethereum purchasing activity, with a large Ethereum investor resuming their accumulation process.

Based on data from blockchain analysis firm SpotOnChain, a large cryptocurrency investor, referred to as a “whale,” has recently withdrawn approximately 7,000 Ether (ETH) – equivalent to around $26 million at the current market price of roughly $3,800 per coin – from Binance, the leading cryptocurrency exchange. This withdrawal follows the investor’s actions during the previous bear market when they withdrew most of their ETH, only to deposit it back onto the centralized exchange once prices started to recover.

As an analyst, I’ve observed a significant surge in Ethereum buying activity following SEC Chairman Gary Gensler’s recent statement during a budget hearing. He suggested that the regulatory body could potentially grant approvals for spot Ethereum ETFs before the summer comes to a close.

As an analyst speaking before a subcommittee of the Senate Appropriations Committee regarding the regulator’s budget, I can attest that the approval process for the specified ETFs has been functioning efficiently since their initial authorization. In other words, the SEC paved the way for these funds to proceed.

In the crypto sphere, there was widespread optimism following the SEC’s approval, resulting in a nearly 20% increase in ETH‘s price within a day. The overall value of the cryptocurrency market experienced a significant boost, adding approximately $200 billion to its total market capitalization.

This approval signifies a noteworthy change for the Securities and Exchange Commission (SEC). Known for its conservative stance on cryptocurrencies, the SEC has previously delved into whether Ethereum, the second-largest digital asset, should be classified as a commodity or a security.

Although the regulatory approvals have been granted for exchange-traded products, VanEck, ARK Investments, and BlackRock, among other ETF issuers, are yet to receive the SEC’s go-ahead on their registration statements. Consequently, trading cannot commence until this approval is secured.

Ethereum Price Analysis

At present, Ethereum hovers slightly above the $3,500 threshold, close to its 50-month moving average, while under the $3,600 mark representing its current 200-month moving average on the monthly graph.

As a researcher studying the cryptocurrency market, I’ve observed that the 50-day simple moving average (SMA) has recently dropped below the 200-day SMA. This occurrence is referred to as a “death cross” and is commonly interpreted as a bearish signal within the trading community. Consequently, it appears that the cryptocurrency is experiencing a downtrend based on this technical analysis.

The RSI of the cryptocurrency is presently hovering around the neutral mark, indicating no clear trend, but it’s showing signs of gaining value in a potentially brief uptrend.

As an analyst, I’ve noticed that the Moving Average Convergence Divergence (MACD) of this asset is currently signaling a potential bullish trend. However, the histogram attached to the MACD line indicates a relatively weak momentum for the price movement at present.

Based on current data, Ethereum’s resistance points are approximated at around $3,500 and $3,600, which align with its moving averages on the monthly chart. Meanwhile, a supportive level can be found near its recent lows of $3,200.

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2024-06-14 17:13