Banking giant Standard Chartered shows increased interest in Ethereum's treasury utilization, stimulating investment hopefulness
In the rapidly evolving world of cryptocurrency, Ethereum (ETH) treasury companies are making waves. One such company, SharpLink Gaming, has recently raised a substantial $425 million through a private placement and switched to an Ethereum treasury strategy in May.
SharpLink Gaming's move towards an Ethereum treasury strategy is not isolated. According to Geoffrey Kendrick, global head of digital asset research at Standard Chartered, Ethereum treasury companies are a better investment option than Ethereum ETFs due to their net asset value (NAV) multiples normalizing above 1. This trend is reflected in the total amount of Ethereum held by treasury vehicles, which has surpassed 10.9 million Ethereum.
SharpLink Gaming is not the only notable player in the Ethereum treasury scene. Companies like BMNR and SharpLink Gaming themselves are among the significant holders of Ethereum. BMNR, backed by Peter Thiel, leads the pack with over 2.069 million Ethereum tokens worth about $8.9 billion, making it the world's largest public Ethereum treasury and the second-largest crypto treasury globally behind Strategy Inc (MSTR). SharpLink Gaming trails BMNR with a holding of 521,900 Ethereum.
The consolidation of Ethereum could indicate the formation of a bullish pennant, a bullish continuation pattern that occurs when a security's price forms a series of lower highs and equal lows, resembling a flag or pennant shape on a chart. Confirming this pattern will require flipping the resistance of the descending trendline and moving above the key selling pressure around $4.1K.
The current price of Ether is near the resistance of a descending trendline near $3.9K. If it stays above the support of a lower rising trendline extending from June 22, it may be ready to retest this resistance. However, the Stochastic Oscillator (Stoch) and Relative Strength Index (RSI) are not offering clear direction near their neutral levels, indicating market participants are uncertain about their next move.
Record outflows in US spot Ethereum ETFs have been followed by ongoing buying pressure from Ethereum treasury companies. If Ethereum retests the $3,600-$4,000 resistance, a decrease in Net Taker Volume and the weekly RSI cooling from overbought may indicate a similar scenario to the 66% price drop seen in late 2024, with Ethereum potentially retreating toward its 50-week and 200-week EMAs, currently at $2,736 and $2,333, respectively, by September or October.
However, the Ethereum price must remain above the $3,220 support level to validate a bullish outlook, which is reinforced by the 50-day Exponential Moving Average (EMA). SharpLink Gaming, with its growing Ethereum holdings and increasing staking rewards, is well-positioned to benefit from any potential price appreciation. The company has even applied to the Securities and Exchange Commission (SEC) to expand its ATM facility to $6 billion.
In conclusion, Ethereum treasury companies are gaining traction in the cryptocurrency market. With their focus on upside exposure to Ethereum price appreciation, increasing Ethereum per share, and offering staking rewards, they present an attractive investment opportunity. As the market continues to evolve, it will be interesting to see how these companies, like SharpLink Gaming, navigate the landscape and capitalize on the potential growth of Ethereum.
