Market speculations arise as Ethereum Foundation conducts $13.3m ETH transfer.
An Ethereum Foundation wallet is said to have sold $13.3 million worth of ETH, causing speculation about a potential price decline. Investors are now considering the impact of this transaction on the value of the second-largest cryptocurrency in the world.
Normally, the actions of the Ethereum Foundation are seen as indicators of market shifts, leading to concerns about a possible decrease in price. However, the current charts show bullish signals for Ethereum.
The price chart for Ethereum presents an optimistic outlook, with a strong upward trend characterized by consistently higher highs and lows. At the moment, Ethereum is trading at $3,550, experiencing a 14.6% increase in the past week. It has a market capitalization of $420 billion and a crypto market dominance of 17.8%, according to CoinGecko.
While market pullbacks are expected during an upward trend, they create anticipation among investors as they wait for the next move. The weekly Relative Strength Index (RSI) is currently at 89.95, approaching the overbought zone, indicating a possible correction. This aligns with the recent sell-off by the Ethereum Foundation.
In the broader market context, Bitcoin has seen a 28% gain in the past week, approaching its all-time high of $69,000. Currently, the price of Bitcoin is around $67,000.
Meanwhile, the Ethereum network is preparing to activate the Dencun update, which combines the Cancun and Deneb updates. This update, scheduled for March 13, aims to reduce layer-2 transaction fees and improve Ethereum’s scalability, efficiency, and security. The Ethereum Foundation announced on February 27 that the upgrade had been successfully activated on test networks.
Last month, Ethereum experienced significant growth, attracting 1.8 million new users to its network. The number of funded Ether wallets also saw a surge, reaching a total of 115.5 million addresses. In contrast, Bitcoin witnessed a decline of 70,000 wallet addresses during the same period, highlighting Ethereum’s dominance in the market.
The increasing demand from new ETH addresses and a $2.3 billion decrease in exchange supply positions Ethereum favorably for a potential rise towards $4,000 in March 2024.
As Ethereum continues its positive trajectory, several issuers are seeking approval for spot Ethereum ETFs, following the success of spot BTC products. However, challenges may lie ahead, as the SEC has postponed decisions on these products until May at the earliest. The fate of Ether-based investment vehicles will be determined in an upcoming meeting between the SEC and spot Ethereum ETF applicants.
The approval of spot Bitcoin ETFs in January was a significant milestone in legitimizing crypto adoption and investment in the United States, influenced by a Grayscale lawsuit against the SEC.
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