Although Ethereum’s price has tumbled by a few hundred dollars since its peak in February, whales have continued to accumulate large portions of the second-largest digital asset. Recent data revealed that large ETH investors own nearly 70% of the total supply – the highest level since late 2017.
The price of ETH has been on a roller-coaster since the start of the year. The asset entered 2021 at $720 before the bull run took it above the previous all-time high at $1,450. However, ETH wasn’t done and even breached $2,000 for a new ATH in February.
The subsequent market correction resulted in a 35% retracement to $1,300. Nevertheless, ETH has reclaimed some ground and currently sits near $1,700 – meaning a year-to-date ROI of 135%.
These highly-volatile price developments and the latest dip haven’t deterred Ethereum whales from purchasing considerable amounts, though. Such addresses, holding 10,000 or more ETH, have been gradually increasing since November 2020, as revealed by data from the analytics company – Santiment.
As a result, Ethereum whales now own 68.6% of the asset’s total supply. According to Santiment, this is the “highest % owned by whales since November 2017.”
ETH Price Vs. Ethereum Whale Behavior. Source: Santiment
Simultaneously, the addresses holding between 10 and 10,000 ETHs have dropped to the lowest % of 27.8 since September 2017.
Apart from expectations for more bullish price developments, another probable reason behind whales’ hunger for ETH could be the upcoming Ethereum 2.0 launch. Although the transition from PoW to PoS is far from complete, investors could benefit from staking their ETH holdings and enjoy handsome returns on various platforms.
When it comes down to massive ETH purchases, it’s also worth exploring the role of the leading digital asset manager – Grayscale. The company offering institutional investors exposition to numerous cryptocurrencies has also substantially expanded its Ethereum holdings in the past several months.
The Grayscale Ethereum Trust (ETHE) had just shy of $2.2 billion in Ethereum AUM at the end of 2020. Since then, though, after multiple considerable purchases, the amount has grown to $4.7 billion as of Friday – March 5th.
In other words, Grayscale’s ETH AUM has more than doubled in about two months. The crypto asset manager also resumed the private placement shares for the Ethereum Trust in January 2021, which is also an SEC-reporting product as of last year.
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