- The launch of an Ethereum-based ETF has attracted increased investor interest in Layer 1 protocols.
- Ethereum has dropped to fifth place among protocols generating the most fees.
- Ethereum may continue to trade horizontally until Grayscale ETHE outflow subsides.
Ethereum rose 3% on Monday as funds flowed out of the Ethereum ETF and increased attention was paid to layer-one blockchain networks.
Daily Digest: Market Drivers: 21Shares Ethereum ETF Increases Transparency, Increases Social Volume
Here are the top Ethereum-related news from the past few hours:
- Asset manager 21Shares has partnered with Chainlink to integrate its Proof of Reserve into the 21Shares Core Ethereum ETF (CETH). The move ensures 21Shares’ transparency into the assets that back CETH.
- Santiment social data shows that investors have shifted their focus from meme coins and small-cap tokens to major Layer 1s like Ethereum, Bitcoin, and Solana. The market has historically shown strength and has occasionally grown when investors focus more on large-cap tokens.
- According to a recent analysis by Token Terminal, Ethereum has fallen to fifth place among the ten protocols with the highest transaction fees in 2024. ETH’s drop may be due to fewer and cheaper transactions on the Ethereum mainnet since the introduction of blobs following the Dencun upgrade in March.
- Ethereum ETFs saw a net outflow of $285 million last week. The outflow came as a result of increased selling pressure on the Grayscale Ethereum Trust (ETHE), which saw more than $1 billion flow out. Many analysts suggest that it will be difficult to determine the impact of the ETH ETF until ETHE outflows slow down.
- Spot-on-Chain reported that a large whale deposited 25.8k ETH worth $87 million on Binance in the last few hours. From May 31 to July 25, the whale withdrew 26,721 ETH from Binance at an average price of $3,457. He deposited 26,660 ETH on CEX at only ~$3,376. His estimated total loss on ETH is $2.16 million (-2.34%).
ETH Technical Analysis: Ethereum to Continue Sideways Movement
Ethereum is trading around $3,350 on Monday, up 3% on the day. ETH’s 24-hour liquidations are $48.37 million, with long and short liquidations standing at $26.9 million and $21.47 million, respectively.
Ethereum recently broke above the $3,357 resistance, despite the majority of traders being bearish, as seen by the ETH Long/Short ratio, which is 0.905. The bearish sentiment may be due to investors expecting further price declines due to outflows from ETHE. As a result, ETH may continue its horizontal trend, but with a downward slant. This move coincides with a drop in ETH options open interest (OI), which fell to $6.09 billion, indicating uncertainty among investors.
ETH/USDT Daily Chart
However, ETH could rally similarly to Bitcoin once the outflow from Grayscale cools down. Therefore, ETH could try to break above the key resistance of $3,730.
In the short term, ETH could rise to $3,413, with positions worth $60.21 million at risk of being liquidated.
