Ethereum Price Drops Over 7% Fueled by Notable Spot Ether ETF Cash Outflows

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As a seasoned financial analyst with a deep understanding of the cryptocurrency market and its intricacies, I have witnessed numerous market fluctuations over the years. The recent decline in the crypto market cap, led by Ethereum (ETH), has been no exception. With nearly $260 million in total liquidations, Ethereum traders were hit the hardest, followed closely by Bitcoin (BTC) traders.

In the last 24 hours, the overall value of the cryptocurrency market decreased by almost 4 percent, with Ethereum (ETH) being the main contributor to this decline. The market cap was approximately $2.42 trillion during the early European session on Thursday. Ethereum’s price experienced a significant drop of around 8 percent, reaching a daily low of roughly $3,156, but has since recovered slightly to around $3,184 as of now.

The abrupt decline in Ethereum caused ripples throughout the crypto market, leading to approximately $260 million in losses for long traders. Amongst these losses, Ethereum traders suffered the most significant impact, totalling around $101 million, while Bitcoin (BTC) traders accounted for roughly $83 million in liquidations.

Poor Performance in US-based Spot Ethereum ETFs

The Ethereum price was significantly impacted by the large-scale withdrawals of cash from recently authorized US-based Ether ETFs. On Wednesday alone, these ETFs recorded a net withdrawal of approximately $133 million, adding to the previous day’s net outflow of around $13 million, resulting in a total outflow of nearly $26 million.

The trust comprised of Ethereum in grayscale form, ETHE, holds approximately $8.04 billion in net assets. A significant sum of around $326.86 million was withdrawn from it. Consequently, the value of ETHE has decreased by roughly $810 million since its trading commencement earlier this week.

On Wednesday, there was approximately $45.93 million in new investments made to the Grayscale Ethereum Mini Trust (ETH), bringing its total assets under management up to roughly $61.08 million.

Over the past day, Grayscale transferred 140,044 Ethereum worth approximately $485.6 million to Coinbase Prime, while receiving around $14.8 million or 4,382 Ethereum in return. The net difference resulted in a significant outflow of roughly $470.8 million or 135,662 Ethereum from Grayscale to Coinbase Prime.
According to #Grayscale’s website, #Grayscale currently holds 2,489,075 $ETH($7.9B).…
— Lookonchain (@lookonchain) July 25, 2024

The Fidelity Ethereum Fund (FETH) delivered the top result, recording approximately $74.46 million in returns.

As an analyst, I’d interpret this information as follows: I observed a net cash influx of approximately $29.64 million into the Bitwise Ethereum ETF (ETHW), consequently elevating its total assets under management to roughly $233 million.

As an analyst, I would put it this way: Recently, approximately 76,699 units of Ethereum valued around Coinbase Prime’s equivalent were deposited into the iShares Ethereum Trust ETF managed by BlackRock.

What’s Next for ETH Price Action

The significant sell-off of approximately $1.1 trillion in US stocks over the past day caused ripples throughout the entire cryptocurrency market. Consequently, Ethereum’s price may experience further declines in the short term. Notably, Ether’s value has dipped beneath both its 50 and 200 daily Moving Averages (MAs).

As a researcher studying Ethereum ($ETH), I have not seen such a bullish chart for quite some time. This current pullback presents an opportunity for those who hold faith in Ethereum. There are two major areas where buying could be considered. The first zone has already been touched, while the second may follow suit, although there’s also a possibility it might be bypassed altogether. With potential for $ETH to reach 4,000 within the next week or two, this is an intriguing development for investors and believers in Ethereum.
— Sheldon The Sniper (@Sheldon_Sniper) July 24, 2024

Sheldon The Sniper, a well-known cryptocurrency analyst, posits that the Ethereum (ETH) price may encounter a stable support level around $3,097. This price point aligns with the 0.618 daily Fibonacci retracement. The analyst suggests that Ethereum’s price could be shaping up for a bullish trend in the medium term, with an anticipated peak of roughly $4,017.

As a researcher studying the Ethereum market, I’ve identified a significant support level for the cryptocurrency at approximately $2,869 based on technical analysis. Should US-based Ether exchange-traded funds (ETFs) experience continued losses in the upcoming weeks, this support level could potentially prevent further price declines.

Based on my experience following financial markets, it’s important to remember that the US Federal Reserve (Fed) is set to announce its latest interest rate decision next Wednesday. As someone who has closely monitored the Fed and its actions over the years, I can tell you that these meetings are always highly anticipated events in the world of finance. The decision on whether to raise, lower, or keep rates unchanged can have significant implications for the economy and financial markets, so it’s essential to stay informed. So mark your calendars for next Wednesday, and let’s see what the Fed has in store for us this time around.

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2024-07-25 11:47