Ethereum (ETH) has beat the resistance at $1,900 for the first time in over nine months, prompting a bullish trend for the digital asset. This was a hard-won level as ETH was struggling under $1,900 for the last week. This recovery has no doubt been a welcome development for investors but what’s driving the price?
Ethereum Sharks Are Driving The Price
According to Santiment, Ethereum shark addresses may have been behind the recent rally. In a report posted to Twitter, Santiment reveals that these accounts holding between 100-10,000 coins have been accumulating ETH at an accelerated rate over the last nine months.
In total, these shark addresses added 2.27 million coins to their holdings which worked out to $4.2 billion. This accumulation pushed their holdings to a new one-year high as they picked up around 1.4% of the total ETH supply.
#Ethereum jumped back over $1,870 today for the first time since August 17, 2022. This near 8-month high comes as sharks have been accumulating steadily since last summer. Addresses holding 100-10k $ETH have accumulated $4.24B in the past 9 months. https://t.co/leyQqlbvED pic.twitter.com/b5YazPfSO5
— Santiment (@santimentfeed) April 4, 2023
Such an accumulation trend can have bullish implications for any digital asset and this could’ve been the case for ETH. As their holdings crossed a new one-year high, the price of ETH was able to break above $1,900, which was a new nine-month high for the cryptocurrency, and it has been holding steady above this level ever since.
What Else Could Be Behind The ETH Increase?
Besides the sharks accumulating ETH, another reason for the increase could be the anticipation of the upcoming Shapella upgrade. With this upgrade, stakers on the Ethereum network will be able to withdraw their staked ETH, something that has been impossible to do since the Beacon Chain was launched.
However, the upgrade could very well be a “buy the rumor, sell the news” event for one simple reason; more ETH coming back into circulation. Realistically, when stakers are able to withdraw their ETH, it is expected that some of these ETH will find their way to exchanges as they try to take profits. But since the ETH price is significantly down from its all-time high, it is likely that a good number will leave their ETH staked as they wait for better prices.
The coins that make it to exchanges though will provide sell pressure for the asset, which will likely lead to a decrease in price, as well as investors securing profits from their assets. A good example is the Cardano Alonzo upgrade which saw the price of ADA rally to new all-time highs ahead of the upgrade and then drops significantly after the upgrade was completed.
Nevertheless, ETH is still seeing good upside at the time of this writing, changing hands at a price of $1,910.