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Highlights
- Ethereum balance on centralized exchanges is shrinking
- The Bitcoin-Ethereum divergence is tightening the more per on-chain data
- Spot Ethereum ETF influence is a factor in the shrinking ETH selloff
Ethereum (ETH) metrics have shown that the digital currency might be suffering from scarcity than earlier projected. According to on-chain data, Ethereum is now being accumulated at a faster rate than Bitcoin.
The Ethereum and Bitcoin Divergence
According to data insights from Leon Waidmann from BTC-Echo, Ethereum is becoming scarcer than Bitcoin. While there are metrics that show the individual performance of BTC and ETH, their correlation per exchange balances is also a crucial one.
🚨HUGE divergence between #Ethereum and #Bitcoin!
ETH is becoming SCARCER than BTC.#ETH Exchange Balance: 10.189% 📉#BTC Exchange Balance: 15.086% 📈
The gap is WIDENING! pic.twitter.com/UnuejbnS8l
— Leon Waidmann | Onchain Insights🔍 (@LeonWaidmann) July 7, 2024
According to the accompanying Glassnode data shared by Waidmann, the current Ethereum exchange balance is pegged at 10.189%. In contrast, that of Bitcoin comes in at 15.08%, a figure that suggests a tightening gap.
Since the conversation around spot Ethereum ETF came into the limelight, demand for ETH has grown. Investors suddenly started buying Ethereum at a frantic pace, accounting for the drain on trading platforms. The investor action is explainable, considering how Wall Street money is projected to buy Ethereum upon ETF launch.
This projection is not unfounded judging by the trend seen in spot Bitcoin ETF products. When the BTC ETF came into the market in January, top firms like Susquehanna International Group (SIG) went all out to buy the asset. The buyups played a crucial role in sending the price of Bitcoin to an All-Time High (ATH) of $73,750.07.
Despite the exchange balance for Ethereum draining fast, the impact on the price of ETH is not visible. At the time of writing, Ethereum is changing hands for $2,983.03, down by 2.31% in the past 24 hours. The coin’s 24-hour low and high trading price comes in at $2,956.99 and $3,080.11 respectively.
Revival Plans for ETH
The future growth of ETH is now hinged on the new long-awaited decision from the US SEC. After it greenlighted the 19b-4 forms for the spot Ethereum ETF application weeks ago, the wait for S-1 is near.
Though the timeline for launch remains largely speculative, the coming 2 weeks appear pivotal. ETF Store President Nate Geraci believes the regulator will do everything it has to do to make Ethereum ETF start trading in 2 weeks.
Read More: Peter Schiff Claims Bitcoin Whales Set Up ETF Investors As “Bag Holders”
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