Key Points
- Fenbushi Capital and Galaxy Digital withdraw large amounts of Ethereum from Binance.
- The withdrawals coincide with a drop in Ethereum’s price and lead to speculations of a potential sell-off.
Crypto analytics platform Lookonchain has reported that Fenbushi Capital and Galaxy Digital, two leading venture capital firms, have made significant withdrawals of Ethereum from the Binance crypto exchange.
Fenbushi Capital withdrew 5,207.4 ETH, equivalent to around $17.2 million, while Galaxy Digital withdrew 6,000 ETH, valued at approximately $19.8 million.
Timing and Implications
The withdrawals happened during a period of price decline for Ethereum. According to CoinMarketCap data, the cryptocurrency is currently trading at $3,315, down by 7.25% in the past week, with the market capitalization also dropping by 0.29% to $398 billion in the last 24 hours.
The withdrawals by Fenbushi Capital and Galaxy Digital have sparked discussions about a potential Ethereum sell-off and its impact on the market. However, it’s important to remember that withdrawals don’t always lead to immediate selling pressure.
The VC firms’ actions could also suggest smart investment strategies. Both Fenbushi Capital and Galaxy Digital might be moving their Ethereum deposits to more secure storage solutions, such as hardware or cold wallets.
Another possibility is that both firms are strategically investing their withdrawn funds into Decentralized Finance (DeFi) protocols or staking programs. By actively participating in these initiatives, these companies may be aiming to increase their Ethereum holdings and generate additional income.
Ethereum’s Price Dip and Contributing Factors
Ethereum’s recent price drop follows a downturn in the crypto market. Bitcoin, the largest digital asset, has seen its price fall from around $70,000 in the past week to $66,051, marking a decline of approximately 6%.
Crypto expert Ali Martnez stated on a social media platform that Bitcoin’s TD Sequential indicator signaled a sell signal, indicating a possible correction. Martnez predicts a downturn lasting one to four weekly candlesticks, implying that the bearish trend may continue for a few more weeks.
Regarding Ethereum’s bearish performance, Martnez stated that the coin lacks support at $3,460, increasing its likelihood of a correction to $2,850 or below.
Another key factor contributing to Ethereum’s price decline may be uncertainty surrounding the launch of an Exchange-Traded Fund (ETF). Bloomberg’s ETF analyst, Eric Balchunas, noted that the likelihood of an Ethereum ETF being launched in May is low at 25%. He pointed out that the US Securities and Exchange Commission has been silent in communicating with ETF applicants, a development that strengthens the approval odds thesis.
