Spot Ethereum ETF Inflows Show Why ETH Whale Selloff Is No Big Concern

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As an analyst with over two decades of experience in the financial markets, I find myself intrigued by this recent development in the Ethereum ecosystem. The surge in spot Ether ETF inflows, totaling $85 million, is a clear sign that institutions are betting on the long-term potential of Ethereum despite the ongoing sell-offs by whales.

After a weak initial phase this week, inflows into Ethereum ETF have picked up again due to the increased market liquidity following the Fed’s interest rate reductions. This renewed interest from institutions has kept the price of Ethereum steady, despite large Ethereum holders (ETH whales) selling off their assets over the past week.

Spot Ethereum ETF Inflows Surge Past $85 Million

This week, the accumulated funds flowing into spot Ether Exchange-Traded Funds (ETFs) exceeded $85 million, marking a significant change from previous weeks’ outflows. This spike coincides with Ethereum’s price showing resilience and climbing towards $2,700, with sights set on further growth to potentially reach $3,000.

On Friday, September 27th, the Ethereum ETF received approximately $58 million in investments. Among these inflows, Fidelity’s FETH accounted for the largest portion at around $42.5 million. BlackRock’s ETHA followed closely with over $11.5 million, while Grayscale’s ETHE experienced outflows totaling nearly $10.7 million, according to data from Farside Investors.

This past week, I observed a significant shift in the Ether Exchange-Traded Funds (ETFs). Over $80 million was withdrawn from these funds due to substantial outflows from Grayscale’s ETHE. Yet, the very next day, I noticed a reversal of this trend with BlackRock stepping in to restart inflows into these investment products.

The recent inflows come when amid the constant sell-offs by Ethereum whale over the past week.

ETH Whale Selloff Continues

During this recent Ethereum price surge, institutional investors appear to be shedding their ETH assets instead of adding to them, as suggested by recent on-chain data. According to LookonChain, two significant institutions have recently reduced their Ethereum holdings.

11,800 Ether, currently valued at approximately $31.88 million, was recently transferred from a digital wallet associated with Cumberland into Coinbase. In a similar timeframe, ParaFi Capital moved 5,134 Ether (valued around $13.83 million) out of Lido and into Coinbase Prime.

2 institutions are selling $ETH!
7 hours back, a digital wallet linked to Cumberland transferred approximately 11.8 million dollars worth of Ether (ETH) into Coinbase, amounting to around 31.88 million dollars. Meanwhile, ParaFi Capital moved over 5.13 million dollars in Ether (about 13.83 million dollars) from Lido and deposited it into Coinbase Prime 6 hours ago.
Address:…
— Lookonchain (@lookonchain) September 28, 2024

Contrarily, a large Ethereum wallet dating back to ancient times cashed out 12,979 ETH this week, amounting to approximately $34.3 million. This whale had last been active around four months ago. In the year 2016, it withdrew 21,632 ETH from ShapeShift and Poloniex when each Ethereum coin was valued at just $7.074. From May 2024 onwards, this whale has sold a total of 15,879 ETH, accumulating $43.5 million at an average price of around $2,739 per ETH.

Following a four-month period without activity, a significant Ethereum investor – often referred to as a “whale” due to the large amount they hold – sold 12,979 additional Ether for approximately $34.3 million this week. This move came as Ethereum experienced a roughly 6% increase in value!
Initially taking out 21,632 Ether (ETH) valued at approximately $7.074 per ETH from ShapeShift and Poloniex back in 2016, this ‘whale’ has since sold off 15,879 ETH.
— Spot On Chain (@spotonchain) September 28, 2024

It appears that purchases made into the Spot Ethereum ETFs have been primarily counterbalancing the significant selling of Ethereum by large investors (whales) over the last seven days.

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2024-09-28 09:58