As a seasoned crypto investor with a decade of experience navigating the wild west of digital assets, I must confess that recent events have left me somewhat uneasy. The $25 million Ether dump by BlockTower Capital and the ongoing selling spree of the Ether ICO whale have certainly raised eyebrows within our community.
A well-known cryptocurrency venture capital firm, BlockTower Capital, recently sold $25 million worth of Ethereum (ETH). This action, made during a rise in ETH prices, could potentially hinder Ethereum’s climb back to $3,000. Additionally, other large Ethereum holders (often referred to as “whales”) also impacted the price by selling over $154 million of their ETH holdings.
BlockTower Capital Dumps $25M Ethereum
On Tuesday, August 13, BlockTower Capital sold a total of 9,232 Ether, valued at around $24.8 million. This transaction was executed using multiple reputable cryptocurrency trading platforms such as FalconX, Cumberland, Wintermute Trading, and B2C2 Group. The distribution of the sales was as follows:
- 3,537.81 ETH via FalconX
2,954.28 ETH through B2C2 Group
2,090.24 ETH via Wintermute Trading
639.28 ETH on Cumberland.
As someone who has been closely following the cryptocurrency market for years now, I find myself increasingly concerned about recent developments. The sudden liquidation of a major player in the space has added fuel to the fire, sparking speculation and unease within the crypto community. This event comes at a time when institutional buying interest appears to be waning, which is never a good sign. Just yesterday, I witnessed Bitcoin‘s price drop by 4.5%, a significant decline that serves as a stark reminder of the market’s volatility. While I have weathered many ups and downs in this space, I can’t help but feel a sense of unease about the direction the market is heading in at the moment.
Furthermore, this decrease seems to be part of a broader pattern, as it appears that institutions are reducing their substantial market investments. According to Lookonchain, a blockchain analysis platform, institutional investors have ceased to receive large quantities of Tether (USDT) from the Tether Treasury and have stopped transferring it to prominent exchanges such as Kraken and Binance. This halt in institutional USDT inflows has been ongoing for the past three days.
Ether ICO Whale & Plus Token Saga
As an analyst, I’ve noticed that the ongoing market struggles are being exacerbated by a significant Ethereum holder, often referred to as a ‘whale’. This whale, who was fortunate enough to acquire 1 million ETH during the Ether Initial Coin Offering (ICO) at a low price of just $0.31 per token, has been actively cashing out large quantities of Ether in the recent past.
On August 12th, a large investor (referred to as a “whale”) sold an additional 5,000 Ether (ETH), equivalent to approximately $13.2 million, on the OKX cryptocurrency exchange. This sale adds to the whale’s total sales over the past month, which now amount to a massive 48,500 ETH, valued at roughly $154 million.
A fresh probe conducted by EmberCN has revealed that there were substantial Ethereum transactions traced back to the closed Bidesk exchange. Over a period of three months between June and September 2021, approximately 789,534 ETH was moved to Bidesk via multiple wallets.
Upon Bidesk’s bankruptcy later that year, these assets were rerouted to the Huobi exchange. Notably, approximately 268,843 ETH were channelled into Bidesk through four distinct deposit addresses. However, some of these assets did not end up in Bidesk, and others were withdrawn but have yet to be transferred to Huobi. As a researcher, I am investigating the whereabouts of these unaccounted-for assets.
The investigation also revealed that 12 addresses connected to the Plus Token ponzi scheme received a significant portion of these Ethereum assets. Last week, $63.1 million worth of Ethereum was transferred, coinciding with the whale’s another 5,000 ETH dump.
It’s possible that EmberCN hypothesized that a large chunk of the 789,534 Ether held by the Chinese government could have been sold in 2021. They imply that this recent transaction might not cause a major stir within the market. However, when you consider this transaction alongside other significant sell-offs by ‘whales’ and the dwindling enthusiasm for Ether Exchange-Traded Funds (ETFs), investors have become more cautious.
Another ETH Price Crash Looming?
As an analyst, I find myself observing the Ethereum price holding steady at approximately $2,656, having encountered resistance at the $2,700 mark. This level aligns with the 78.6% Fibonacci retracement point. The price action at this level, coupled with the impending death cross, indicated by the 50-day Exponential Moving Average (EMA) dipping below the 200-day EMA, hints at a possible bearish trend in the near future.
In simpler terms, a “death cross” is often viewed as a significant warning sign for traders, prompting them to consider selling or securing their positions more tightly. Meanwhile, the Moving Average Convergence Divergence (MACD) indicator, at present, remains in negative territory, suggesting it’s time to sell.
The MACD showing a negative reading suggests that traders might want to think about taking short positions for Ether. If the price drops below the immediate support at $2,500, it could indicate a bearish trend as previously reported by Coingape. A fall below this support might strengthen the effect of the death cross and possibly lead to a rapid sell-off towards the $2,000 level.
Over the past week, Ethereum approached a potential support level at around $2,100. This means it’s possible we could see further drops below $2,000. But the In/Out of the Money Around Price (IOMAP) model indicates that while there isn’t much resistance above $2,500, there seems to be a clear path for Ethereum to rebound towards $3,000.
If Ethereum surpasses the nearby $2,700 barrier, it might trigger swift upward price action. This surge could initiate a fresh bullish trend that may propel the price towards $4,000. However, CrediBULL Crypto, an analyst on X platform, anticipates a downward trend for Ethereum before it surpasses $3,000 and later $3,600, suggesting a bearish outlook.
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2024-08-13 11:28