The leverage in the Ethereum market is approaching record highs, while Binance has a relatively low leverage ratio, combined with large capital inflows creating potential local selling pressure.
Demand from institutional investors and the development of the Ethereum network continue to drive value and liquidity, despite short-term volatility risks due to high leverage and strong resistance levels.
MAIN CONTENT
Leverage in the Ethereum market is nearing record highs, while Binance maintains a lower leverage ratio.
Ethereum ETF in the United States records historic capital inflow, significantly increasing trust from institutional investors.
Short-term volatility risk is high but network upgrades and institutional capital inflows are expected to support the long-term upward trend.
What is Ethereum's leverage level and how does it affect the market?
Ethereum market leverage (ELR) currently stands at 0.68, close to historical highs, according to CryptoOnchain's analysis on August 11. Binance maintains a lower leverage ratio (0.52), indicating that other exchanges have higher leverage.
This leverage allocation poses a risk of strong volatility if there is selling pressure from exchanges outside of Binance. Large capital inflows from Binance also increase the risk of local selling at this exchange, affecting Ethereum's price in the short term.
"High leverage on many exchanges can make the Ethereum market sensitive to sudden price shocks."
CryptoOnchain, Cryptocurrency Analyst, August 2024
What factors are supporting Ethereum's positive mid-term trend?
Demand from institutional investors continues to be the main driver for Ethereum, as spot ETFs in the U.S. set a record capital inflow of 726.6 million USD per day, raising total holdings to over 5 million ETH, equivalent to about 20.3 billion USD.
Notably, Ark Invest and Fundamental Global have purchased a total of 30,755 ETH and invested 200 million USD into the Ethereum treasury fund, enhancing institutional credibility. The network's liquidity, record on-chain trading volume along with staking development strengthen the technical and financial foundation for Ethereum.
What are the risks and opportunities of Ethereum's short-term price volatility?
The short-term price volatility of Ethereum is rising due to high leverage, challenging important resistance levels and capital inflows to exchanges. These factors could trigger fairly strong price drops.
However, strong institutional capital inflows, stable ETF demand, and upcoming network upgrades like Pectra and Fusaka are expected to improve scalability and utility, helping to mitigate deep volatility and maintain a long-term upward trend. Key support and resistance levels are concentrated around 3,980–4,020 USD and 4,450–4,550 USD.
"Network upgrades like Pectra will enhance scalability, maintaining Ethereum's position in the future."
Ethereum Developer, 2024
How will upcoming upgrades impact Ethereum?
The Pectra and Fusaka updates focus on improving Ethereum's performance and scalability, reducing congestion, enhancing user experience, and expanding applications.
This is an important step to enhance the competitiveness and attractiveness of the Ethereum ecosystem for both developers and investors, while supporting the sustainable development of the network in the long run.
Frequently Asked Questions
How will high Ethereum leverage affect investors?
High leverage increases price volatility risk and the likelihood of position liquidation, investors need to manage risk closely and monitor leverage levels on exchanges.
What role do Ethereum ETFs play in driving the market?
ETFs help attract large institutional capital inflows, enhance liquidity and stability, while building trust for long-term investors.
How do Pectra and Fusaka support Ethereum's development?
These upgrades improve network scalability and performance, reduce transaction fees and increase applicability within the ecosystem.
What are the current key support and resistance levels of Ethereum?
Ethereum is experiencing support around 3,980–4,020 USD and resistance at 4,450–4,550 USD, investors are monitoring to make appropriate decisions.
How is the Ethereum staking process expected to evolve?
Staking continues to attract many participants, helping to enhance network security and create a stable passive income stream for investors.
Source: https://tintucbitcoin.com/ethereum-ho-tro-va-khang-cu-quan-trong/
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