Cryptocurrency Shifts Focus to Ethereum as Bitcoin Experiences Significant Sell-offs
In the ever-evolving world of cryptocurrencies, this week has seen a significant shift in the balance between two of the most prominent digital assets: Bitcoin (BTC) and Ethereum (ETH).
Starting with Ethereum, the past few days have witnessed continued institutional inflows. Leading digital asset manager Grayscale added $45 million worth of ETH, raising its holdings to a staggering $7 billion. This move reinforces the growing interest of institutional investors in Ethereum, as the platform continues to develop and expand its use cases.
However, the Ethereum/Bitcoin (ETH/BTC) cross has broken the 0.04 barrier, signalling a rotation narrative that intensifies. This shift suggests that investors are increasingly favouring Ethereum over Bitcoin, possibly due to Ethereum's growing DeFi (Decentralised Finance) and NFT (Non-Fungible Token) ecosystems.
On the other hand, Bitcoin faced a setback this week. A large early-holder sold 24,000 BTC, equivalent to $2.7 billion, causing a flash-crash on Sunday. This significant sell-off has put a dent in Bitcoin's price, with the current support now at $111K to $109K, and resistance at $115K to $116.8K.
The BTC sell-off has also been reflected in Bitcoin Exchange-Traded Funds (ETFs), which have experienced a six-day outflow streak totalling $1.2 billion. Meanwhile, Ethereum ETFs have logged a $238 million weekly outflow, indicating a broader trend of investors shifting away from Bitcoin and towards Ethereum.
The altcoin market has seen a surge in leverage, with altcoin futures OI surging +$9.2 billion in a single day to a record $61.7 billion. This increased leverage raises fragility risks in the altcoin market, as it could potentially amplify price swings and volatility.
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As always, it's crucial to approach the cryptocurrency market with caution and to conduct thorough research before making any investment decisions. This update is intended for informational purposes only and should not be taken as financial advice.
Stay tuned for more updates as the cryptocurrency market continues to evolve.
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