Key Points
- Ethereum’s price is under pressure with significant amounts being sold off by large holders, known as “whales”.
- Despite the introduction of Ethereum ETFs, there is declining interest in Ethereum-related investment products.
Ethereum (ETH), the second-largest cryptocurrency globally, is currently facing a challenging period. It has been underperforming compared to other major altcoins like Solana, despite the introduction of exchange-traded funds (ETFs) giving it a boost.
Over the past year, Ethereum’s price has seen a 52% increase, while Solana has surged over 600%. This lackluster performance has seemingly shaken the confidence of Ethereum’s largest holders, often referred to as “whales”. These whales have recently begun offloading significant amounts of ETH.
Significant ETH Sell-Offs
The Ethereum Foundation, the organization behind Ethereum’s development, is a significant player in this sell-off trend. The Foundation recently transferred 35,000 ETH, worth around $94 million, to Kraken, a leading cryptocurrency exchange. These sales by the Ethereum Foundation have historically been associated with periods of increased price volatility for ETH.
Another large Ethereum holder, known as a “diamond hand whale,” has moved 25,000 ETH, approximately valued at $74 million, to various exchanges. According to data from blockchain analytics firm Santiment, there has been a noticeable decrease in the number of addresses holding between 10,000 and 100,000 ETH since early July.
Jump Trading, a well-known trading firm, has also significantly reduced its Ethereum holdings. The firm moved approximately 88,917 ETH, valued at $276 million, to various crypto exchanges between late July and early August. This large-scale sell-off coincided with notable declines in ETH prices.
Declining Interest in Ethereum ETFs
Alongside these significant sell-offs, there is evidence of diminishing interest in Ethereum-related investment products. Spot Ethereum ETFs have experienced a continuous stream of outflows since mid-August, indicating a declining investor appetite for these products.
Even BlackRock’s Ethereum ETF, which recently launched on the Brazilian Stock Exchange on August 28, has not attracted the level of interest initially expected. This lukewarm response to these ETFs underscores a broader lack of enthusiasm for Ethereum in the current market environment.
Current Market Sentiment
Currently, Ethereum is trading at around $2,496, reflecting a decline of more than 4% in the last 24 hours. Despite some bullish signals, such as a record low in the amount of ETH held on exchanges, which could indicate potential upward price movement, current market indicators are predominantly bearish.
The Relative Strength Index (RSI) shows Ethereum is in oversold territory, signaling that sellers are currently driving the price action. If Ethereum fails to hold a key support level at $2,490, analysts warn that the price could fall further, potentially reaching $2,300. Conversely, a return of buying interest could push ETH back up towards the $2,800 mark.
