ETH volume on exchanges falls to a multi-year low
The drop began after the partial approval of spot asset-based ETFs
03.06.2024 - 10:47
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What's new? Since the US Securities and Exchange Commission (SEC) partially approved Ethereum-based spot exchange-traded funds (ETFs), more than $3 billion worth of coins have been withdrawn from centralized crypto exchanges (CEX). Thus, according to CryptoQuant data, the amount of ETH on exchanges dropped by about 797 000 between May 23 and June 2.
What happened? As a result, ETH volume on the CEX fell to 10,6% of total supply which is a multi-year low. The decline means that fewer coins are available for sale as investors move ETH to personal wallets for storage.
Some analysts believe Ethereum could hit an all-time high of $4870 as of November 2021 again once spot ETFs start trading on US stock exchanges, driving demand.
ConsenSys CEO predicts a reduction in the ETH supply if spot funds are launched
Joe Lubin noted that over a quarter of the total supply is staked
Earlier, weekly ETH spot trading volume reached a remarkable 87% of BTC, setting a new record.
Last week, the SEC approved Form 19b-4 applications for trading rule changes filed by stock exchanges that intend to flood spot ETH crypto funds.
Now, to launch trading, the commission must also approve the fund-issuing investment companies' applications to register new securities on Form S-1. According to some experts, this process could take up to three months.
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