Whales Are Accumulating - The Daily Gwei #186

Are you?

The term “whales are accumulating” is a bit of a meme within the crypto ecosystem and is commonly used to try to signal to people that their favorite coin is being bought up by big players in anticipation of a rise in price. Though there is sometimes truth to this claim as you can see from my tweet below.

My tweet pulls its data from this dashboard and essentially shows that the number of Ethereum addresses holding 10,000 ETH or more is at an all time high. At time of writing 10,000 ETH is worth $19.2 million which is firmly in “whale” territory and not something to be taken lightly. This shows that “big money” seems to have strong confidence in ETH and expects it to appreciate in the coming months - why else would they be accumulating?

Outside of this on-chain data we can also look at things like the Grayscale ETH investment trust which has gobbled up over 3 million ETH ($5.7 billion) over the last 18 months. This trust is essentially a “one-way street” as there is no redemption function so it’s probably going to continue gobbling up ETH as investors are hungry to get tax-advantaged exposure to ETH. I really do wonder how much ETH this fund ends up eating up as 3 million is already ~2.6% of the current circulating supply!

I think that what all of this also shows is that a large cohort of investors are now buying and holding ETH as a store of value. To even entertain the idea of ETH as a store of value would’ve been met with harsh resistance in 2019 and even the first half of 2020. But now, no one can deny that ETH is being used as a store of value as there is 3.1 million ETH staking in eth2, 7.7 million ETH being used in DeFi, 3 million ETH in the Grayscale investment trust and millions more ETH being held on both the fund & individual level.

When I look at all of this data and see that ETH is now sitting at over $1,900 after being worth just $100 a little over a year ago, I just can’t help but be amazed. I’m sure those who’ve been around for a while will remember all the talk about Ethereum and ETH being “dead” during 2018 and 2019 so to see ETH be at fresh all time highs with a market cap that is worth ~25% of Bitcoin’s market cap fills me with joy. All of the hard work that the Ethereum community put in over the years is finally paying off in a really big way!

It’s also been wonderful to see the evolution of ETH as an asset over the years. It started off as just being viewed as a utility token to pay for gas, then it was used as money to invest in ICOs, then it started being used in DeFi and finally it was used within eth2 for staking. Today, it’s all of this and more and this is why I believe that ETH is the best programmable store of value asset in existence.

Have a great day everyone,
Anthony Sassano

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All information presented above is for educational purposes only and should not be taken as investment advice.