The launch of U.S.-based spot Ether ETFs has led to mixed results for Ethereum’s price.
BlackRock’s iShare Ethereum Trust (ETHA) attracted inflows of $91.4 million on August 1st, showing positive activity. Meanwhile, Grayscale’s Ethereum Trust (ETHE) continues to experience outflows, with the total amount exceeding $2 billion since it was converted to a spot product.
See Also: Ether ETFs Approved By The SEC
Effect Of Spot Ether ETFs on Ethereum’s Price
Even though Grayscale’s outflows have been large, there are signs that the trend might be slowing down. On August 1st, ETHE’s net outflow was $78 million, which is the first time it dropped below $100 million since the fund’s launch. Some analysts see this as a possible reversal sign that could potentially boost Ethereum’s price.
The overall flow of spot Ether ETFs has been unstable during the week. BlackRock’s ETHA has been the main attraction for investors, consistently drawing in money, while Grayscale’s ETHE continues to see withdrawals. This back-and-forth movement reflects how sensitive Ethereum’s price is to these fund activities.
Following a brief increase before the ETF launch, Ethereum’s price has dropped by 8.5%, now trading around $3,168. This decline is due to several factors, such as large deposits of Ethereum on Binance linked to Elwood, which has sparked concerns about a potential sell-off. Additionally, the expiration of $600 million worth of Ethereum options, with a put-call ratio of 0.55, has added to the market’s volatility.
Despite this recent drop in price, some analysts remain hopeful about Ethereum’s longer-term outlook. The continued buying by large investors, often referred to as whales and sharks, suggests they expect the price to rise again. Moreover, new inflows into the broader cryptocurrency market, with stablecoin market capitalization reaching its highest level since April 2022, could also provide support for Ethereum in the coming days.
The price or Ethereum is currently hovering around $3,165, with resistance at the $3,200 level. If it manages to break above this resistance, a short-term rally might occur. However, if it falls below the important $3,000 support zone, it could face further losses.
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