According to an analysis by on-chain analytics firm CryptoQuant, the total value of Ethereum (ETH) in accumulation wallets has increased to over 19 million.
Ethereum accumulation continues to increase
Analysis shared by CryptoQuant verified analyst Burak Kesmeci indicates that more than 19 million ETH is now held by so-called “accumulation addresses”. As of January 2024, these addresses held around 11.5 million ETH.
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The fast increase in ETH held by accumulation addresses suggests that sophisticated investors can anticipate a recovery in the digital asset market later in the year.
Kesmeci highlighted that the amount of ETH held in these addresses has almost doubled and could exceed 20 million ETH by the end of the year. Several factors contribute to this high level of ETH accumulation.
First, the approval of Ethereum-based exchange-traded funds (ETFs) earlier this year by the U.S. Securities and Exchange Commission (SEC) gave much-sought regulatory clarity and approval to the second-largest cryptocurrency by reported market cap. The analyst explains:
Regulations have increased trust, making Ethereum popular. It is no longer just for technology enthusiasts – institutions and individuals see it as a fundamental part of the financial future. I expect these addresses to hold more than 20 million ETH by the end of the year. With Ethereum priced at around $4,000, the total value will exceed $80 billion, making these accumulation addresses as valuable as some of the largest companies in the world.
From October 18, 2024, US-based ETH spot ETFs to hold total net assets worth $7.35 billion, representing almost 2.3% of Ethereum’s market cap. Over the past week, ETH spot ETFs have attracted $78.9 million in net inflows after two consecutive weeks of net outflows.
70% of ETH holders make a profit
Data from IntoTheBlock shows that 70% of ETH holders are in profit, while 28% are in loss and 2% are at break-even.
Additionally, 74% of current ETH holders have held the digital asset for more than a year, while 23% have held it for more than a month but less than a year. These factors indicate that investors are not eager to dump their ETH holdings anytime soon.
Most profitable holders could lead to increased buying pressure, potentially driving up ETH prices. However, profit-taking by many holders can also result in selling pressure, creating volatility.
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The case for increased ETH volatility is strengthened by the recent strong ascend in open interest for the digital asset. Some crypto analysts are confident that ETH will retest some of its crucial resistance levels before further upward moves.
For example, crypto analyst Carl Runefelt recently opined that if ETH breaks the $2,640 resistance level, it could initiate a significant price rally. ETH trades at $2,663 at press time, down 2.4% in the last 24 hours.
Featured image from Unsplash, chart from Tradingview.com