Ethereum Climbs to New All-Time High Above $1550, Institutional Purchases Resume With Grayscale Buying

03. Feb 2021 Posted by Akolkar B on News

The world’s second largest cryptocurrency Ethereum (ETH) has surged to its new all-time high moving past $1550 levels on Tuesday, February 2. At press time, ETH is trading at $1529 with a market cap of $175 billion.

With this, Ethereum (ETH) is now bigger than some of the biggest financial banking institutions like Citi Group, Wells & Fargo, Goldman Sachs and others.

The latest surge in the ETH price rally comes as institutional purchases resume. A day before, on Monday, world’s largest digital asset manager Grayscale resumed new investments from accredited investors into the Grayscale Ethereum Trust (ETHE).

On Tuesday, Grayscale added nearly 25K Ethereum (ETH) coins to its trust with an aggregated purchase value of $38 million. The Grayscale Ethereum Trust (ETHE) now holds 2.96 million ETH coins with net assets under management surging to more than $4.5 billion.

Interestingly, the ETH price rally comes just ahead of the launch of CME Ether Futures next week on February 8. This indicates a strong institutional interest in the crypto asset. There’s a few reasons that has led to the Ether price rally on Tuesday. Some of these are:

  • The open interest for ETH Futures has hit an all-time high of $5.60 billion surging more than 47% in the last 24 hours.
  • Ethereum’s on-chain fundamentals also see a great improvement recently. Over the last week, a large number of ETH coins have been move to cold storage. The total ETH supply at the exchanges have dropped significantly while the demand continues to increase leading to a price surge.
  • The total number of Ethereum staked with the ETH 2.0 deposit contracts is now worth more than $4.0 billion.
  • Also, the number of whale addresses holding more than 10,000 ETH coins has reached the highest level in 13 months. Alone in January 2021, 35 new such addresses have been created.

Despite all the fundamental upticks, JPMorgan has asked to maintain caution concerning the euphoria around the CME Ether Futures launch. As reported by Bloomberg, the JPMorgan strategists added futures can possibly lead to “negative price dynamics” as it gives big players the opportunity to hedge the asset.

Thus they note that launch can negatively affect ETH price just it did to the Bitcoin (BTC) price when CME Bitcoin futures launched in December 2017 just as Bitcoin hit its all-time high then.