Ethereum (ETH), the second-largest cryptocurrency by market capitalization, has experienced a significant price decline in recent weeks. As of Thursday, August 29th, ETH was trading around $2,550, representing a drop of over 24% in the past 30 days.
According to Spot On Chain, a leading blockchain analytics platform, several key entities, including the Ethereum Foundation, Jump Trading, and two major whales, have collectively sold a staggering 197.8K ETH, valued at approximately $599 million. This selling pressure has contributed significantly to the market downturn.
Ethereum Foundation and Jump Trading Offload ETH
The Ethereum Foundation, the organization responsible for developing and maintaining the Ethereum blockchain, was one of the notable sellers. On August 23rd, the Foundation deposited 35K ETH, worth $93.8 million, to the Kraken exchange. This move was followed by a 9% price drop in ETH over the next five days, highlighting the Foundation’s potential influence on market dynamics.
Jump Trading, a prominent quantitative trading firm, has also been actively selling ETH. Between July 25th and August 6th, Jump Trading deposited a net 88.9K ETH, worth $276 million, to various centralized exchanges. This activity preceded a sharp 20% decline in ETH prices on August 5th.
Whale Activity Exacerbates Price Pressure
Two major whales have also contributed to the ETH price decline. An ICO-linked whale identified as “0xе17” has been actively selling ETH since July 9th, depositing large amounts to exchanges. This whale has sold a total of 108.5K ETH, valued at $343 million, leading to notable price drops.
Another whale, identified as “0x682,” has also been selling ETH. This whale deposited a total of 25K ETH, worth $73.9 million, to the Kraken exchange on two separate occasions, both preceding significant price declines.
Institutional Interest Wanes
In addition to these selling pressures, a decline in institutional interest in Ethereum has also contributed to the price drop. Despite a dovish stance from Federal Reserve Chair Jerome Powell, recent data indicates a waning demand for ETH from institutional investors.
Technical Analysis Indicates Potential Downward Pressure
Renowned trader Peter Brandt has highlighted the significance of the $2,814 support/resistance level for ETH. If ETH fails to close above this level consistently, it could face further downward pressure, potentially leading to a price decline towards $2,000.
From a technical perspective, ETH’s price needs to reclaim the weekly 50 Moving Average (MA) as a support level. Additionally, the Relative Strength Index (RSI) should rise above 50 to mitigate the risk of a more significant price correction in the coming weeks.
Disclaimer: The information in this article is for general purposes only and does not constitute financial advice. The author’s views are personal and may not reflect the views of Chain Affairs. Before making any investment decisions, you should always conduct your own research. Chain Affairs is not responsible for any financial losses.
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