Ethereum’s price dropped over 12%, rebounding from $2,312.58 to $2,438 after a major ICO participant sold 6,000 ETH worth $14.11m.
Over the course of the past week, the price of Ethereum has been performing poorly, and as of today, it has dropped by more than 12%. On the other hand, the asset saw a brief rebound, finding support at an intra-day low of $2,312.58, and then surged back up to $2,438, which is a 5% increase from the day’s low.
This comeback occurred following the announcement that a famous Ethereum initial coin offering (ICO) participant, known as a “whale,” has sold another significant percentage of their holdings.
Ethereum ICO Whale Sells 6,000 ETH
According to statistics provided by the blockchain analytics firm LookOnChain, an anonymous whale participating in the Ethereum ICO recently sold 6,000 ETH, estimated to be worth around $14.11 million. This transaction is part of a larger sales frenzy that the same whale has been engaging in since September 22nd, during which time they have been selling 40,000 ETH worth a total of $101 million at an average price of $20,525.
Despite this, the whale still has 99,500 ETH, which, at the current price of ETH, is equivalent to $238 million. Investors have expressed concerns about the potential for additional price corrections due to these large-scale sales. Recent whale behaviors suggest that investors should raise a clear-cut plan or alarm to effectively secure earnings in the event of bears seizing market control.
When looking at the market as a whole, the supply of ETH that is now in circulation has been gradually growing, particularly as a result of the recent shifts in monetary policy. In a recent series of tweets, cryptocurrency researcher Benjamin Cowen mentioned that the supply of Ethereum has been growing by 60,000 ETH every month since April 2024.
If this trend continues, total supply will return to pre-merger levels by year’s end. Cowen pointed out that the recent reductions in interest rates by the Federal Reserve have helped to drive demand, but a more aggressive reduction of at least one hundred basis points might be required in order to bring about a significant shift in the price trend of Ethereum that is in line with the Ethereum ICO move.
Benjamin Cowen also brought attention to the fact that similar movements have occurred in the past, specifically in 2016 and 2019, particularly in the fourth quarter, when the price of Ethereum experienced a precipitous decline. According to Cowen’s analysis, the price of ETH/BTC could be on the verge of seeing yet another significant decrease, similar to the patterns that have occurred in the past.
Trading volumes and spot ETF inflows have both decreased, reflecting the fact that investor sentiment towards Ethereum has shown signs of deterioration. Over the past week, the amount of derivative trade in Ethereum has declined by 34.97%, currently standing at $21.94 billion.
This decrease is indicative of a decline in interest and possibly a decrease in market liquidity, both of which may indicate a pessimistic view or a phase of consolidation, as demonstrated by Ethereum ICO. Furthermore, open interest in Ethereum ICO derivatives increased by a marginal 2.80%, reaching a total of $11.58 billion following the transaction.
It is possible that some investors are retaining their positions in anticipation of future price swings, either upward or downward, in the coming months, as this combination of lesser volume and larger open interest may signal. Furthermore, Vitalik Buterin, one of Ethereum’s co-founders, has suggested potential solutions to improve the ecosystem in light of these issues.
In an effort to attract more people to participate in Ethereum’s proof-of-stake network, Buterin recently proposed lowering the minimum Ethereum staking barrier from 32 ETH to 16 ETH. According to technical research, a recent decrease in Ethereum (ETH) has pushed its price into a significant support area between $2,440 and $2,252, which also shows that the Ethereum ICO move has occurred.
If the price of ETH manages to close above the midpoint of this range, currently at $2,340, it could signal a stabilization point. This might indicate that a reversal may occur. According to market analysts, if the price breaks through the resistance level of $2,564, it could pave the way for a potential rally toward the psychological mark of $3,000.
This rally could possibly reach $3,500, depending on the conditions in the rest of the market. However, Bitcoin’s performance will be a critical factor in determining whether or not this rise will occur. The price of Bitcoin remaining consistent in the region of $61,000 to $62,000 could provide support for Ethereum ICO and other alternative cryptocurrencies, thereby strengthening investor confidence.
