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Will Ethereum Price Follow Bitcoin As Whales Continue To Accumulate?

Last Updated March 1, 2024 1:01 PM
Nikola Lazic
Last Updated March 1, 2024 1:01 PM

Key Takeaways

  • Ethereum’s price increase lags behind Bitcoin’s surge.
  • Ethereum whales actively transferring and accumulating ETH.
  • Correction is looming but still no signs of weakness

Bitcoin has risen, surpassing its last resistance of $53,000, reaching a high of $57,000 today. This rise of more than 10% brought the price back close to its all-time high. Not only that, though, but it sparked a bullish sentiment after some period of uncertainty. 

Ethereum is lagging, but its price rose around 7% from February 26 to a high of $3,267 on February 27. This continues an uptrend which started on January 23. However, the price of ETH is still significantly lower than its all-time high of $4,800. 

With some evidence of whales accumulating and growing institutional interest in ETH, will Ethereum’s price catch up to Bitcoin? 

ETH Whales On The Move

In a recent flurry of activity, three Ethereum whales have transferred over $64 million worth of Ethereum from the Binance and Kraken exchanges, highlighting a significant movement within the cryptocurrency space, according to Lookonchain 

This activity includes a massive $45.5 million Ethereum stake from Binance, and a collective withdrawal of $18.7 million worth of Ethereum from Kraken by two new whales. Another transaction involved a whale acquiring $6.2 million worth of Ethereum from Kraken. As a result, the whale now holds more than $85.2 million worth of Ethereum. This means, with the current Ethereum price at $3,230, they have achieved an unrealized profit of more than $26 million.

Additionally, a wallet suspected to belong to Tron founder Justin Sun made significant Ethereum purchases from Binance worth $41.24 million, contributing to a total of over $543.8 million in Ethereum acquisitions over the past 13 days. This activity coincides with Ethereum’s price increase of over 4% in the last 24 hours and more than 37% since the beginning of the year, underscoring the cryptocurrency’s growing appeal.

Institutions Prefer ETH over BTC 

A Bybit research study  further illuminates a trend among institutional investors showing a marked preference for Ethereum over Bitcoin. This contrasts with retail investors’ broader interest in Bitcoin and various altcoins. Institutional portfolios are now predominantly invested in Bitcoin and Ethereum, constituting 80% of their cryptocurrency holdings. 

This shift is mainly due to the anticipated Dencun upgrade for Ethereum and its transition to a proof-of-stake model, among other factors, which have led to Ethereum’s significant market value increase and a 33% rally year-to-date.

Bybit research
BTC vs ETH portfolio allocation over time

The study indicates a strategic move by institutional investors towards more stable investments. It seems like institutions are now focusing on coins and DeFi protocols and moving away from more volatile options, such as memecoins and AI tokens. This change in strategy highlights Ethereum’s central role in institutional investment strategies.

Ethereum Price Analysis 

The price of ETH reached a bear market low of $1,000 on June 2022. Since then, it has formed two slightly higher lows but got to a high of $2,100 in mid-April 2023. This was, most likely, its consolidation phase after the bear market ended. 

Daily chart
ETH going parabolic

Finally, after establishing its second higher low of $1.560 on October 11, a new climb began, leading ETH into a breakout above $2,100 and on to a high of $2,700 on January 13. 

After a minor pullback to $2,180 on January 23, it started the current uptrend, reaching a high of $3,315. This increase of nearly 50% is still developing, which is why we might see ETH heading higher in the next couple of days. 

However, it is starting to interact with the 1.618 Fibonacci extension level, a typical ending point of wave three, and the daily chart Relative Strength Index (RSI) is signaling overbought conditions. These could be some signs of caution, indicating another correction to start shortly, but there aren’t any signs of struggle regarding the price. 

Its first bear market lower high was at $3,600, which could be the next target. After the current upward momentum stops, we could see a correction for a higher degree wave four. But, since ETH is in a new bull cycle, it should, eventually, continue moving up, revisiting its all-time high. 

Disclaimer

Please note that the contents of this article are not financial or investing advice. The information provided in this article is the author’s opinion only and should not be considered as offering trading or investing recommendations. We do not make any warranties about the completeness, reliability and accuracy of this information. The cryptocurrency market suffers from high volatility and occasional arbitrary movements. Any investor, trader, or regular crypto users should research multiple viewpoints and be familiar with all local regulations before committing to an investment.

 

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