Key Takeaways:
- The US SEC exempted Ethereum from its lawsuit against Binance.
- However, ETH outflows on Binance reached $778.6 million.
NEW DELHI (CoinChapter.com) — The US Securities and Exchange Commission (SEC) exempted Ethereum (ETH) from its list of crypto asset securities in its lawsuit against Binance. However, that did not stop investors from moving their ETH holdings off the world’s largest exchange by volume.
Crypto analytics firm Nansen noted that net ETH outflows on Binance since June 5 rose to $778.6 million. The negative net flow resulted from ETH outflows totaling $1.65 billion, outweighing the inflows of over $871 million.
Moreover, Nansen noted that ETH flow remained negative in the 1-hour time frame. Binance saw hourly ETH outflows of over $50 million at the time of Nansen’s tweet.
In addition, Ethereum co-founder Jeffrey Wilcke moved 22,000 ETH (worth $41 million at the time) to the crypto exchange Kraken. Interestingly, the transfer occurred just hours before news of the SEC’s legal action against Binance hit the wires.
Meanwhile, Ethereum was not the only asset that suffered outflows on Binance. Bitcoin (BTC) also recorded outflows of 11,380 BTC from the beleaguered exchange, according to Cryptoquant data
However, Cryptoquant noted that the outflows were not very significant.
Net outflows so far are smaller than what the exchange has experienced in other periods of “stress” (or regulatory FUD).
Cryptoquant stated
For example, Bitcoin outflows following the FTX crisis reached 40,353 BTC in Dec 2022.
Also Read: Breaking: SEC Sues Coinbase After Binance, Lists 13 Crypto Tokens As Security
Additionally, the on-chain data platform assured users that the outflows were insignificant compared to the exchange’s reserves.
ETH Price Recovers From Binance Lawsuit FUD
Exclusion from the Binance lawsuit helped ETH price break away from the resulting FUD. The Ethereum token price fell nearly 4.3% on June 5 before bulls moved to defend the 100-day EMA (blue wave) support near $1,800.
The 5.7% spike on June 6 helped Ether recover most of its losses from the previous day. However, the multi-week descending trendline continues to repel ETH price action. Therefore, breaking above the trendline could help the prime altcoin price rally to the resistance level near $1,930.
Flipping the immediate resistance could help Ether price target resistance near $2,050 before downside corrections pare gains.
However, the lawsuit could inject more FUD into the crypto ecosystem, particularly as the back-to-back attacks on the sector highlight SEC’s stance on cryptos.
Bradley Duke, founder and co-CEO at crypto ETP provider ETC Group, told CoinChapter that the SEC’s actions suggest the US no longer welcomes crypto firms.
“In contrast, Europe’s recently ratified MiCA framework offers up clear rules and guidance to crypto firms, giving comfort to services providers and investors alike“
Bradley Duke told CoinChapter
Therefore, bearish pressure from the FUD could force ETH price to breach the immediate support level and drop to support near $1,700 before recovering.
The RSI for ETH remained neutral, with a value of 53.9 on the daily charts.
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