- Ethereum has dropped below $2,000 again, facing selling pressure from hacker wallets while whales rush to accumulate at lower levels.
- Ethereum network activity remains sluggish, with record-low transaction fees signaling weak demand despite ongoing whale accumulation.
Ethereum (ETH) has once again slipped below the critical $2,000 mark, experiencing a steep decline of over 5% overnight. This latest downturn saw ETH trading near a three-month low at $1,917, reflecting a sharper drop compared to Bitcoin (BTC), which only pulled back slightly to $86,000.
Whales Accumulate as ETH Struggles
Despite the market downturn, large investors, commonly known as whales, have seized the opportunity to buy the dip. Data indicates that whales are accumulating ETH under $2,000, reinforcing its value as a fundamental asset for DeFi, trading, and collateral in lending protocols. While ETH remains at a crossroads, with 45% of holders in profit and 51% at unrealized losses, recent whale acquisitions suggest confidence in a potential relief rally.
One notable whale recently removed $108 million worth of ETH from exchanges, mirroring previous instances of large-scale accumulation. Such moves hint at a strategic play, possibly anticipating a price rebound. However, derivative markets suggest the possibility of ETH dipping further to the $1,800 range to liquidate long positions before a short squeeze occurs.
Hacker Wallets Add to Selling Pressure
While whales accumulate, Ethereum faces continued selling pressure from hacker wallets. Recent blockchain transactions revealed that two addresses received 14,064 ETH from THORChain and CoinFlip, swiftly converting over $27 million into DAI. These transactions highlight how exploited funds continue to flow through decentralized platforms, exerting downward pressure on ETH’s price.
Hacker traders, unlike traditional whales, aggressively sell off their holdings without concern for fees or slippage, creating additional volatility in the market. The lingering impact of hacked funds being dumped reinforces bearish sentiment in the short term.
Ethereum Fees at Record Lows – A Sign of Weak Network Demand?
Another concerning trend is Ethereum’s dwindling network activity, reflected in extremely low gas fees. Average transaction fees have plummeted to just $0.02, with primary activity revolving around simple ETH and USDT transfers. Broader network use, including DeFi borrowing, bridging, and NFT minting, has slowed significantly, contributing to Ethereum’s increased inflation rate of 0.80%. This rise in ETH issuance adds further bearish pressure, raising concerns over prolonged price stagnation.
What’s Next for Ethereum?
With market uncertainty prevailing, Ethereum’s price trajectory remains uncertain. Whale accumulation suggests underlying confidence, yet weak network activity and persistent hacker-driven sell-offs continue to weigh on ETH’s recovery. If demand for Ethereum’s ecosystem does not pick up soon, the token may remain under pressure, with a potential retest of lower levels before any meaningful rebound occurs.
