Ether, the native cryptocurrency of the Ethereum network, has seen a significant increase in long-term holder accumulation despite a 2% price dip over a 24-hour period.
According to data from CryptoQuant, on June 12, 2024, accumulation addresses acquired approximately 298,000 Ether tokens, equivalent to around $1.34 billion at the time. This acquisition volume was only 6% lower than the previous record set on September 11, 2023, when long-term holders purchased 317,000 Ether as the price dipped below $1,600.
The increased demand for Ether comes amidst an 8.49% price decline over the past seven days. Although the cryptocurrency briefly fell below $3,800 on June 8, it has remained above $3,400 during this period, based on CoinMarketCap data. At the time of writing, Ether is trading at $3,500.
The $3,500 price level has proved to be a resilient resistance for Ether bulls, as observed in past price action. Despite the price dip, long-term holders have continued to accumulate Ether, indicating their confidence in the cryptocurrency's long-term potential.
The surge in Ethereum demand and long-term holder accumulation has been attributed to several factors. Firstly, the potential approval of spot Ether exchange-traded funds (ETFs) by the United States Securities and Exchange Commission (SEC) has been a significant catalyst. During a Senate Banking Committee hearing, SEC Chair Gary Gensler hinted at the possibility of granting final approvals for listing and trading shares of spot Ether ETFs within the next three months.
The approval of spot Ether ETFs could have far-reaching implications for the cryptocurrency's status. According to industry experts, the SEC's approval of these commodity-based trust shares implies that the regulator explicitly recognizes Ether as a non-security. This recognition could extend to other tokens as well, solidifying their classification as commodities.
Digital asset lawyer Justin Browder stated that if Ether ETFs receive S-1 approval, which is the final requirement for them to begin trading, it would settle the debate once and for all, affirming that ETH is indeed not a security. This could have significant implications for the broader cryptocurrency market, as it could provide clarity and regulatory certainty for other projects.
The increased long-term holder accumulation of Ether suggests that investors are confident in the cryptocurrency's long-term prospects, despite the recent price dip. This trend could continue as the potential approval of spot Ether ETFs and the recognition of Ether as a non-security could further bolster investor confidence in the Ethereum ecosystem.
Overall, the surge in Ether demand and long-term holder accumulation amidst a price dip highlights the resilience and growing maturity of the Ethereum network, as well as the increasing institutional and retail interest in the cryptocurrency.
