Institutional Investors Flock to Ethereum, Holdings See Notable Uptick Amid ETF Hype: CryptoQuant

The increased bullish sentiment has led to an approximately 15% increase in the price of Ether within a 30-day period. The fact that Ethereum is now trading above $2,000 suggests a growing focus on the asset, and this renewed optimism has propelled the year-to-date gain in ETH price to almost 70%.

New data suggest a surge in institutional holdings in the crypto asset.

Surge in Institutional Ethereum Holdings

According to CryptoQuant, there has been a notable uptick in institutional holdings of Ethereum, both through direct ownership and indirect channels such as trusts, ETFs, and funds, in November. This increase coincided with ETH’s price finding stability in the range of $1.8k to $1.9k.

Such a heightened institutional interest suggests a growing confidence among investors in Ethereum’s long-term value and the promising prospects for market expansion, according to the analysis.

“It reflects their strong belief in Ethereum’s long-term value and the market’s potential for growth.”

The latest analysis also suggested that the growing appeal of Ethereum to institutional investors is reinforced by its ongoing technical advancements. The implementation of Ethereum 2.0 upgrades and the enhancement of smart contract functionalities have played a significant role in attracting institutional attention, underscoring the crypto-asset’s attractiveness as a long-term investment opportunity.

Ethereum ETF Hype

The buzz among institutional investors kicked off at the beginning of the month when the US Securities and Exchange Commission (SEC) acknowledged Grayscale Investment’s bid to transform its Ethereum trust into an ETF.

This SEC action stems from a specific court mandate instructing a review of Grayscale’s pending ETF applications. As of now, there is no official confirmation regarding the approval of a spot cryptocurrency ETF.

Market optimism surged when BlackRock, the world’s largest asset manager, formally submitted an application for a spot Ether ETF on November 9. This confirmation led to the Ether price breaking through the $2,000 resistance, marking a six-month high on the same date. BlackRock officially lodged the S-1 form with the SEC on November 16.

Experts predict the SEC will approve a spot Bitcoin ETF in early 2024, and following this, approval for a spot Ether ETF is widely expected to follow quickly, according to various crypto analysts.

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