Ethereum Whales Prepare for Potential ETF Approval Amid Market Divergence

On Tuesday, whales and institutional investors have been strategically positioning themselves ahead of the anticipated approval of the Ethereum futures Exchange-Traded Fund (ETF) on October 2, 2023. These significant holders of Ethereum, whose activities can greatly influence the market, have been accumulating more tokens during recent price dips, signaling their optimistic outlook for Ethereum’s future.

Open interest in Ethereum options on the Chicago Mercantile Exchange (CME) has reached a record high of $352 million, indicating robust participation from institutional investors. This increase in interest is perceived as a sign of confidence and hope for positive developments following the ETF approval.

Recent data has shown a noticeable rise in whale transactions during a recent market downturn. This purchasing activity suggests that Ethereum whales took advantage of the price drop to gather more tokens. The distribution of Ethereum holdings reveals a rise in the number of whales holding between 100,000 to 1,000,000 ETH, increasing from 19.1 million on August 19 to 20.19 million as of September 24.

On September 12, when Ethereum fell significantly to $1,551, there was a marked increase in whale transactions exceeding $100,000. This appears to indicate a strong trend toward asset accumulation among these key market players.

However, on-chain analysts have observed trends that may have led to a temporary slowdown in Ethereum’s growth. After the successful Shapella upgrade, Ethereum had rallied to the $2,100 mark before its recent decline. Analysts suggest that a lack of risk appetite among large wallet investors is reflected in the current market dynamics.

One key divergence noted by experts is between Ethereum’s trading volume and its price. Such divergences suggest a dwindling risk appetite among traders. An expert analyst and trader predicts that Ethereum may continue to form lower highs, viewing the price chart as a prime opportunity for redistribution.

While the precise effect of the ETF approval on Ethereum’s price remains uncertain, market participants are bracing for increased volatility and trading activity. This event marks a significant milestone for Ethereum and the broader cryptocurrency landscape, potentially leading to greater institutional engagement and market expansion.