Ethereum Price Drop Causes Concern Among Investors, Influenced by Whales and ETFs
The cryptocurrency market has faced a significant setback recently, with Ethereum witnessing a sharp decline like many other digital assets. Specifically, the second-largest cryptocurrency by market cap, Ethereum, saw a 9% drop in value within just 24 hours, although it has been making efforts to recover from this slump. This sudden plunge was triggered by substantial sell-offs from large holders and ETF investors, adding further strain to an already fragile market.
The decline in the Ethereum price can be attributed to massive sales orchestrated by whales, who have been actively offloading their holdings in recent hours. These large holders have been transferring substantial amounts of ETH to centralized platforms to liquidate their positions. For instance, one whale withdrew 5,088 ETH from Binance, valued at $17.24 million, only to sell them for $13.58 million, resulting in a significant loss of $3.66 million. Similar actions from whales collectively selling thousands of ETH have been observed to avoid liquidation on lending platforms like Aave.
Simultaneously, Ethereum ETFs have been experiencing a challenging period, with net outflows totaling $13.2 million over eight consecutive days. Major funds such as Grayscale (ETHE), Fidelity (FETH), and Franklin (EZET) have been particularly impacted, reflecting a loss of confidence among institutional investors. The substantial withdrawal from ETFs has further intensified selling pressure, indicating a growing sense of short-term skepticism towards ETH.
The crypto community’s response to these developments has been swift, with mounting doubts about Ethereum’s future. Some voices within the community have criticized key figures in the project, including Vitalik Buterin, for allegedly lacking faith in ETH as a store of value. These criticisms underscore underlying frustrations regarding the handling of the current crisis and the strategic direction of the platform. However, Vitalik Buterin has defended his stance by revealing that he holds 90% of his wealth in ETH, emphasizing his personal commitment to the network’s future.
From a technical perspective, the signals are mixed but suggest a potential continuation of the downward trend. The Relative Strength Index (RSI) has crossed below its moving average, indicating increasing selling pressure. The stochastic oscillator shows signs of weakness, although it could present an opportunity for buyers if ETH enters the oversold zone. Currently, Ethereum’s price remains vulnerable around $3,460, with potential risks of sliding to support levels between $2,000 and $2,300.
The uncertainty looms large, with the market eagerly anticipating the next developments to determine whether Ethereum will rebound or continue its downward trajectory.
