What roles are institutions playing in driving Ethereum prices?
Ethereum is in a bit of a pickle at the moment. After rallying up to $3600 in the beginning of October, the asset has been witnessing a wave -like movement and breached its resistance at $3,600.
Although the price has been building hihger and witnessing correction, data suggested there a potential correction on its way.
While no harm has been done to its bullish structure, a drop down to $3000 could be in play due to fundamental reasons, one of them being of high importance, that is institutions.
It is important to note that certain on-chain metrics remain strongly bullish for Ethereum. As per Santiment, the top 10 non-exchange whale addresses continued to accumulate and locked more ETH away than the top 10 exchange addresses, which is a good bullish sign.
Daily active addresses for Ethereum also continued to display bullish divergence as the price of ETH dipped a little since September, but active addresses have continued to rise in the charts.So overall, the on-chain narratives remain positive but a $3000 slide could be lucrative for the long-term picture as well.
So according to a recent survey, Digital Asset BiMonthly Fund Manager by Coinshares Research, close to 42% of investors regarded Ethereum to possess the most compelling growth curve.
The survey represented close to $440 billion assets under management and one of the common reasons behind Ethereums’ expected growth, was network diversification.
Now, on the flip side, Coinshares recent weekly fund inflows pictured a different scenario.
Data showed that Ethereum registered minor outflows of $13.5 million, which indicated possible institutions cashing out at the moment. While Bitcoin registered strong inflows of $225 million.
Yes, this is where the institutions can actually drivethevaluedownto$3,000,justtopushitbackup.
The plot of accredited investors needs to be understood from a long-term perspective. Unlike retail investors, institutions do not panic in the market, and they are more likely to buy into the asset when it is at a local bottom or in a liquidity zone.
This could fundamentally be the prime recovery position for Ethereum, as institutions may look to fill their bags in this price range. However, the price may structurally move above as well, so it is essential to Do Your Own Research.