Ethereum Price Heads toward $5k: Whales Inject $2 Billion Within 5-Days of ETF Approval

Ibrahim Ajibade
Updated: May 26, 2024, 18:49 GMT+00:00

Key Points:

  • Ethereum (ETH) price surged above $3,850 territory on May 26, sparking hopes of another bullish week ahead.
  • The top 1,000 Ethereum wallets have accumulated within 510,000 ETH within the 5-days of the ETF approval
  • As investors await influx of funds into the newly-approved ETH spot ETFs, the next major resistance cluster at $4,200 now poses a major challenge.
Ethereum ETH Price Prediction

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Ethereum price surged above $3,850 twice in the last 48-hours, as bullish investors front-run influx of funds into the newly-approved ETH spot ETFs. On-chain data analysis explores how whale investors are positioned for the next market phase. 

Ethereum Whales Invest $2 Billion in 5-days

On May 23, US Securities and Exchange Commission (SEC) approved spot Ethereum ETF for trading in the United States regulated markets, sending seismic shockwaves across crypto markets last week.

After an initial 29% 3-day rally to a 40-day peak of $3,945, ETH price briefly retraced towards $3,556 level after the SEC’s official verdict on May 23 as swing traders capitalized on the market euphoria to book early profits.

Ethereum (ETH) Price Action After ETH Approval
Ethereum (ETH) Price Action After ETH Approval

However, bulls regained foothold of the Ethereum markets at weekend, with ETH price surging 9% to reclaim the $3,850 territory at the time of writing on May 26.

The resurgent Ethereum price rally can be attributed to widespread expectation that ETH ETFs will receive billions of inflows as they head into the first full week of trading.

Notably, the 10 approved Bitcoin ETFs have accumulated over $58 billion worth of BTC holdings within 5-month from the official launch in January 2024, with over $10 billion of that coming within the first month of trading.

Majority of crypto investors now widely anticipate that ETH will also receive a similar degree of demand from institutional investors across the US market in the week ahead.

To front-run the upside from billions of expected inflows when ETF ETF markets open on Monday May 27, the largest investors on the Ethereum network have been spotted making significant purchases since the ETF approval date.

The Santiment chart below shows real-time changes in balances of ETH coins controlled by the top 1,000 largest wallets.

Ethereum price vs. ETH Top 1,000 Wallet Balances
Ethereum price vs. ETH Balances in Top 1,000 Largest Wallets

Ethereum’s top 1,000 investors held a cumulative balance of 76.01 million ETH as of May 19. But as indicated by the blue trend line in the chart above, the whales instantly increased their buying momentum after Bloomberg analysts broke the news of the SEC’s impending approval verdict for ETH ETFs on May 20.

Ethereum’s top 1,000 largest, wallets now hold 76.52 million ETH at the time of publication on May 26, reflecting that they rapidly acquired 510,000 ETH within the last 5-days.

Valued at the current ETH prices of around $3,855 per coin, this implies the whales invested over $1.95 billion since the Ethereum ETF approval.

As many large institutional investors look to front-run the bullish impact of the ETFs inflows, ETH price will like witness more whale demand,  in the week ahead.

Ethereum Price Forecast: $5k target now in focus

Ethereum price is currently trading at $3,855, up 6% over the weekend. With the added market liquidity, and whale investors propensity for long-term holding, the $1.9 billion buying frenzy could be the beginning of an ETH price ascent towards new all-time highs above $5,000.

Ethereum (ETH) Price Forecast 
Ethereum (ETH) Price Forecast

Looking at the historical accumulation trends, Ethereum price now faces a major resistance around the $4,200 level where, 9.7 million active addresses had acquired 3.5 million ETH coins in the past.

If bulls can scale the $4,200 resistance level as ETH ETFs begin to receive inflows in the coming week, a parabolic price breakout to new all-time highs above $5,000 could be on the cards in June 2024.

It is also important to note that, asides from the USA, Ethereum ETF have also been officially approved for trading by authorities in Hong Kong earlier this year.  This could also receive significant inflows from Chinese investors following the US SEC’s nod.

About the Author

Ibrahim Ajibade Ademolawa is a seasoned research analyst with a background in Commercial Banking and Web3 startups, specializing in DeFi and TradFi analysis. He holds a B.A. in Economics and is pursuing an MSc in Blockchain.

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