The Shift Towards Long-Term Investments in Ethereum as Staked Supply Hits 29%
There has been a noticeable trend in Ethereum [ETH] towards long-term investment strategies, with over 19 million ETH currently held in wallets as of October 18th.
This represents a significant increase from 11.5 million ETH at the beginning of the year, underscoring the growing confidence of investors in Ethereum’s future potential.
Increased Ethereum Accumulation
Recent data from CryptoQuant highlights a substantial surge in Ethereum holdings within accumulation addresses. At the start of 2024, these addresses contained 11.5 million ETH, a number that almost doubled by October.
Analysts predict that the amount stored in these addresses could exceed 20 million ETH by year-end, sustaining this upward trajectory.
The rise in long-term holdings indicates that major investors and Ethereum proponents are strategically building their positions, anticipating future growth. The introduction of Spot ETFs earlier this year has further fueled this accumulation by attracting more mainstream interest to Ethereum. Additionally, the uptick in ETH staking activities serves as another driving factor behind the mounting accumulation.
Staked Ethereum Nearing 30% of Total Supply
As accumulation escalates, staking has emerged as a pivotal element in Ethereum’s market dynamics. Dune Analytics data discloses that 34,600,896 ETH are currently staked, constituting almost 29% of ETH’s overall supply.
With a substantial portion of ETH now locked in staking contracts, the overall market may witness diminished sell-side pressure. This scenario could potentially bolster Ethereum’s price in the short term, as the reduced availability of ETH for trading may foster price stability or even further appreciation.
Positive Trajectory for Ethereum
Currently, Ethereum is trading at $2,649, slightly above significant support levels.
The 50-day moving average at $2,476 has proven to be a solid support level, while the 200-day moving average at $3,022 has acted as a crucial resistance point.
A breakthrough above this resistance level is imperative for Ethereum to sustain a prolonged upward trend.
The Relative Strength Index (RSI) rests at 61.61, indicating moderate bullish momentum without venturing into overbought territory.
Meanwhile, the Chaikin Money Flow (CMF) stands marginally negative at -0.07, suggesting limited buying pressure but not enough to signal a bearish reversal.
Although Ethereum’s outlook remains positive, surmounting the $3,022 barrier is vital for a more robust upward trajectory. In the presence of market volatility, the $2,476 support offered by the 50-day moving average may play a crucial role.