ETH’s latest milestone could mean nothing if these holders stay on edge

Post­ed: Sep­tem­ber 15, 2023

• Ethereum’s unique address activ­i­ty trig­gers excite­ment about ETH’s bull­ish prospects.
• A deep­er exam­i­na­tion revealed a lack of con­fi­dence and con­vic­tion in ETH bulls.

The cryp­to mar­ket is final­ly show­ing some love to the bulls after a long bear­ish streak. Amid the return­ing hype, Ethereum’s unique wal­lets bounced to the sec­ond-high­est lev­el since the net­work was launched.

How many are 1,10,100 ETHs worth today

A recent San­ti­ment analy­sis looked into the recent spike in the num­ber of unique wal­lets on the Ethereum net­work on Wednes­day (13 Sep­tem­ber). This was for both senders and receivers and the address­es report­ed­ly reg­is­tered the sec­ond-high­est surge in Ethereum’s entire existence.

😮📊 The #Ethereum net­work just saw 1,089,893 unique wal­lets act­ing as a sender or receiv­er of $ETH on Wednes­day, the 2nd high­est amount in the asset’s 8+ year his­to­ry. This his­toric anom­aly could be the capit­u­la­tion sig­nal need­ed for prices to rebound. https://t.co/JF0g8vvBWs pic.twitter.com/1dRnPCjxcA

— San­ti­ment (@santimentfeed) Sep­tem­ber 14, 2023

A bull trap in the making?

The same San­ti­ment analy­sis sug­gest­ed that the spike could be a reflec­tion of bull­ish activ­i­ty back­ing a piv­ot. An assess­ment of liq­uid­i­ty flow may offer some clar­i­ty. The return of the bulls would like­ly be char­ac­ter­ized by heavy exchange out­flows rel­a­tive to inflows indi­cat­ing that liq­uid­i­ty was flow­ing into pri­vate wallets.

Ethereum exchange flow data revealed that inflows have been dom­i­nat­ing and were high­er than exchange out­flows. This could indi­cate that the ongo­ing ETH liq­uid­i­ty flow wasn’t con­sis­tent with a strong bull­ish move.

Source: Cryp­to­Quant

Despite the above find­ings, ETH’s price action pulled off a 5% upside in the last 3 days. This is the first time that the cryp­tocur­ren­cy has achieved a 3‑day con­sec­u­tive ral­ly since June. ETH exchanged hands at $1631 at press time.

ETH’s spike in unique address­es could be a good indi­ca­tor of the return of volatil­i­ty. How­ev­er, we still haven’t iden­ti­fied what the key mar­ket movers have been up to. The sup­ply of ETH held by top address­es reached a new week­ly high in the last 24 hours. This could be tak­en as a con­fir­ma­tion that whales were still buy­ing at the cur­rent levels.

Source: San­ti­ment

Are ETH whales in opposition?

Despite the whale accu­mu­la­tion, ETH’s weight­ed sen­ti­ment indi­cat­ed that the cur­rent ral­ly was backed by low con­fi­dence. Some whales were still con­tribut­ing to sell­ing pres­sure. Thus, hold­ing down ETH from more poten­tial gains.

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Accord­ing to the sup­ply dis­tri­b­u­tion met­ric, address­es hold­ing between 10,000 and 100,000 ETH fell by a sub­stan­tial mar­gin. The same applied to address­es hold­ing at least 1 mil­lion ETH. The rest of the whale address­es have been accumulating.

Source: San­ti­ment

The sup­ply dis­tri­b­u­tion indi­cat­ed a lack of con­sis­ten­cy or uni­for­mi­ty among the whales. Anoth­er sign that demon­strates why the cur­rent ral­ly might be limited.

As such, the recent spike in unique address­es may not nec­es­sar­i­ly be a sign that the ongo­ing ral­ly is the big one. The con­trast­ing on-chain find­ings offer an opin­ion that ETH might not be ready to give up its recent bear­ish tendencies