Is the Rise in Self Custody a Bullish Sign for Ethereum?
Investors in Ethereum are showing signs of bullish sentiment following the approval of Ether futures exchange traded funds (ETFs) by the US Securities and Exchange Commission (SEC). On chain data from Santiment reveals that the number of ETH tokens sitting on exchanges is currently at a five-year low. This is due to an increase in self custody of tokens since mid-August 2023. The highest exchange outflow was recorded on Wednesday, October 4, 2023. Historically, an increase in token outflows from crypto exchanges has been seen as a bullish sign, indicating potential volatile sentiment in the future.
Ether ETFs Trigger Price Spike
Several Ether futures products were launched on October 2, 2023, including offerings from BitWise, ProShares, and VanEck. This launch resulted in an immediate spike in the price of Ethereum, fueling hopes of an upcoming bull run for the token. While optimism remains high for the approval of a spot Bitcoin ETF by the end of 2023, recent delays in decision making by the SEC have dampened these hopes. However, there is still optimism surrounding approval thanks to a crucial ruling in the Grayscale lawsuit. In addition, Grayscale has filed with the SEC for conversion of its Ethereum Trust into a spot Ethereum ETF.
Hot Take: Bullish Signs for ETH Price
The rise in self custody of Ethereum tokens and the approval of Ether futures ETFs by the SEC are both bullish signs for the price of ETH. The decrease in tokens sitting on exchanges indicates increased confidence among investors and a potential supply shortage, which can drive up prices. The launch of Ether futures products also indicates growing interest and investment in Ethereum. While delays in Bitcoin ETF approvals have caused some uncertainty, the positive developments in the Ethereum market suggest a potential price rally for ETH in the near future.
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