The price of Ether (ETH), the world’s second largest crypto-digital coin, surpassed $3,500 in the morning of May 6, hitting another record high. A few days ago, after breaking the $3,000 barrier, the price of Ether hit new highs. Bitcoin, on the other hand, is in repeated shocks, and the strong performance of Ether, which has always been a “loser”, is a surprise.
Today, the total coin value of Ether is $400 billion, about 40% of Bitcoin. At this time last year, the difference between the two was more than 7 times.
It should be noted that the coin holding address of Ether is excessively concentrated in large investors, which hides a lot of risks. The reporter found that the number of coin-holding addresses in the whole network of Ether is as high as 150 million, but 31% of Ether is held by the top 50 addresses. In addition, as of May 6, 7 of the top 10 mobile addresses in 7 days sold off a large number of Ether, totaling about 1.29 million, or have cashed out over $4 billion.
Over 16 times increase in one year
Ether “demonstrates” bitcoin
In recent days, the “big” ethereum opened “up and up and up” market, many times refreshing the highest price in history.
The crypto digital coin quotation software non-small App shows that at around 6:00 a.m. on May 6, the price of Ether broke through $3,500, setting a new record high. Before that, the price of Ether has continued to rise for many days since it broke through the $3,000 barrier from May 3. As of the morning of the 7th, the price of Ether was $3,529, with a total coin value of over $400 billion, a recent 1-week increase of nearly 29%, and a recent 1-year increase of more than 16 times to 1,633%.
“The cryptographic digital coin Ether (ETH) issued by the blockchain network protocol layer is the basis for the proper operation of distributed applications.” William Li, chief researcher of OEE OKEx Research Institute, told the Securities Daily that most of the value of the blockchain network is concentrated in the network protocol layer (Ether network), and a small portion of the value is distributed in the application layer (distributed applications). Take distributed finance as an example, 90% of DeFi projects are concentrated in the Ethernet network. the boom of DeFi directly drives the market demand of ETH and drives the high price of ETH.
According to William Li, from the news, Canada launched three Ether ETFs at the end of April; European investment banks also spread the news that they will issue digital bonds on the Ether network. All these news are directly favorable to the rise of ETH price.
“The ratio of bitcoin to ethereum has hit a new high this year, implying that the bull market in the crypto market has entered the second half.” Long Dian, founder of FireNews Finance, analyzed to reporters that the superposition of dealer speculation effect and retailer psychological effect caused the surge of Ether. On the one hand, influenced by the fund rotation effect, the profit-taking discs and speculative funds that purchased bitcoin in the early stage started to seek new concepts and targets, and for ethereum, which just broke through new highs, the speculative funds further pushed the price up. On the other hand, the bull market of crypto market attracts more and more newcomers to enter the market. Most of the new users have a wait-and-see attitude towards the high priced bitcoin, and ethereum, which looks cheaper per unit, becomes the priority choice for the newly entered retail investors.
The reporter found that the rising ferocious Ether is rapidly narrowing the coin value gap with Bitcoin.
The non-smaller app shows that the current price of bitcoin is about $57,000 and the total coin value is $1 trillion, roughly 2.5 times that of ethereum, from the same time frame. And a year ago, at the beginning of May last year, Bitcoin’s total coin value reached $169 billion, while Ether was $23 billion, a difference of more than seven times. In terms of market share, Bitcoin currently accounts for about 47% of the total value of global crypto-digital coins, while Ether accounts for 18% and is on the rise.
However, according to William Lee’s analysis, “Bitcoin’s position as the ‘Maotai’ of the crypto-digital currency market is hard to shake. Currently in the crypto-digital coin bull market phase, various cottage coins generally rose, which in turn pulled down bitcoin’s market share; in the future, when the market enters the bear market phase, bitcoin’s market share will increase again.”
Multiple large investors collectively reduced their holdings
Selling 1.29 million ethereum
The reporter observed that while Ether was reaching record highs, many large investors took the opportunity to sell off a large number of Ether.
Ether holdings are relatively concentrated, with a large number of Ether concentrated in a few large investors. The non-small app shows that the number of Ether holding addresses is 150 million, with the top 10 largest addresses holding 19% of the coins and the top 50 largest addresses holding 31% of the coins. It is said that a coin-holding address is an address with a certain token, similar to the name of an account in Alipay or a bank card.
“In general terms, the more decentralized the holding address is for a certain coin, the more stable and secure it is relatively.” Ding Feipeng, director of the criminal department of Beijing Shanghuang Law Firm, analyzed to Securities Daily, but it is not enough to analyze only from the holding address, but also to see whether there are third-party platforms such as exchanges and wallets in the previous holding addresses, because these platforms hold a large number of retail crypto assets on behalf of the investors, which will lead to the “illusion” of relatively concentrated holding.
“About three years ago, in June 2018, the top 10 ethereum addresses held only 10% of the coins. Among them, except for the ‘cold wallet’ which has not been moved since its inception, other addresses have had a process of ‘chip absorption’ in these three years. This indicates a rising risk of Ether price manipulation.” Fu Rao, executive director of the International New Economy Institute, told reporters.
It is worth noting that as of May 6, as many as 1.29 million Ether were sold by large investors in seven days, or more than $4 billion had been cashed in. The non-small app shows that as of May 6, 7 of the top 10 liquid addresses have reduced their Ether holdings within 7 days, with the total number of holdings reduced up to 1.29 million, and with the opening price of $3,300 on May 6, the 7 large investors may have made a profit of $4.3 billion.
According to Fu Rao, the massive selling of Ether by the top 7 liquid addresses indicates that the “bankers” of Ether think that the price of Ether is overvalued now. However, the top 10 addresses have been “sucking chips” for many years and have plenty of chips in their hands, so they may not be “escaping from the top”.
“The recent massive sell-off of liquid addresses may not be the result of large investors cashing out, but may be due to third-party institutions, such as the promotion of hot projects.” Ding Feipeng reminded that crypto assets are an emerging investment with both risks and opportunities, so as an ordinary investor, you should fully assess your risk tolerance and invest rationally before investing.
Posted by:CoinYuppie，Reprinted with attribution to:https://coinyuppie.com/ether-price-exceeds-3500-to-reach-a-new-high-several-large-investors-focus-on-selling-or-cashing-out-more-than-4-billion/
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