In New York City, whale transactions involving Ethereum (ETH) valued at over $100,000 saw a significant increase in March, reflecting a growing optimism among investors. Despite facing challenges like the Dencun Upgrade, Ethereum experienced only a slight uptick of 0.79% over the course of the month, with the cryptocurrency struggling to surpass the $4,000 mark and dropping to $3,500. However, large investors continued to show confidence in Ethereum by adding more exposure to their portfolios.
Throughout March, there was a notable rise in whale transactions worth over $100,000, leading to a surge in smaller whale wallets holding between 1,000 and 10,000 coins. This accumulation strategy, commonly known as “buying the dip,” involves purchasing assets during temporary price drops in anticipation of future price increases. This approach is typically adopted for assets with strong fundamentals and long-term growth potential.
The bullish sentiment was further reflected in the increase in long exposure in derivatives markets. Data from Hyblock Capital showed that approximately 72% of total whale positions on crypto exchange Binance were betting on Ethereum’s price to rise. This bullish strategy adopted by whales appeared to resonate with the broader market, as indicated by the Fear and Greed Index showing a mood of “Greed.”
One motivating factor behind the bullish outlook on Ethereum was the increasing likelihood of Ether spot ETF approval. Concerns had been growing regarding the approval of Ether spot ETFs due to the potential classification of Ethereum as a security by the U.S. Securities and Exchange Commission. However, the Commodities Futures Trading Commission (CFTC) recently classified Ethereum as a commodity in a lawsuit against KuCoin, reigniting hopes for the eventual approval of an Ether spot ETF.
Investors are hopeful that if an Ether spot ETF is approved, it could have a similar impact on Ethereum as witnessed with Bitcoin since mid-January. The potential approval of spot ETFs for Ethereum could open up new avenues for investment and further boost the cryptocurrency’s market presence.