Ethereum price rapidly tumbled to a 25-day low of $3,428 on June 13, 2024, amid intense volatility in the wake of the US Fed rate pause announcement; on-chain data trends suggest more downside ahead.
Ethereum Price Falls Below $3,500 First Time Since ETF Approvals
The crypto market has been in a consolidation phase for the better part of the past month. During that period, ETH managed to outperform the market average thanks to bullish tailwinds from the ETF approval from the US SEC in late May.
However, three weeks after the official approval verdict, the fund sponsors are still stuck, making final adjustments to filings before the official market listing of the Ethereum ETFs.
After another week of little progress, with no tentative listing date in sight, investors now seem to be growing impatient. This led to a major price downswing on June 14, after the US Fed announced a hawkish rate pause, ending hopes of an H1 2024 cut as many bullish analysts had expected.
As seen above ETH price fell 9.71% within the weekly time-frame, surrendering most of gains earned in the wake of the ETF approval. The chart shows that as ETH tumbling towards $3,362 on June 14, before rebound towards the $3,550 mark at the time of writing on Saturday June 15.
But notably, the last time ETH price traded below $3,400 was May 21, before the rally that greeted the de-facto ETH ETF approval news broken by the Bloomberg Analysts. This shows that the delays surround the ETFs official launch has adversely impacted demand for Ethereum this week, raising the risk of more price downside.
Selling Pressure from ETH Long-term Holders Rises 10%
Evidently, the recent Ethereum market demand is now in decline as bulls have grown fatigued amid the 3-week hiatus around the official ETH ETF launch.
However, looking at the on-chain data, recent activity among existing ETH holders shows the market volatility may not be over yet.
Santiment’s Mean Coin Age data tracks the average amount of days that all ETH coins in circulation have spent in their current addresses. A decline in Mean Coin Age occurs when a large number of long-term holders are actively selling, and vice versa.
The chart above illustrates how the ETH Mean Coin Age (365d) has been in a rapid decline since May 29, as it became evident that the Ethereum ETFs would take weeks to launch after the official SEC verdict on May 24.
Between May 29 and the time of publication on June 15, Ethereum’s mean coin age has declined 10% from 172.23 to 164 average days held.
Such a significant decline within a short period shows a growing selling trend among long-term Ethereum investors who had previously held their coins unmoved for one year or more. This suggests that they have been selling their coins behind the scenes, capitalizing on the price surge in the aftermath of the ETF approval.
With a significant number of coins locked-up for over year now is circulation again, ETH price is likely to experience more volatility in the days ahead.
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