Here’s Why Ethereum Price Is Falling Today

by

As a seasoned financial analyst with extensive experience in the crypto market, I have witnessed numerous price fluctuations and market reactions to significant events. The recent Ethereum price crash, following the successful launch of the Ethereum ETF, is a classic case of the “sell-the-news” phenomenon that we’ve seen before, most notably with Bitcoin earlier this year.

The day following the successful debut of the Ethereum-linked SPOT ETF, Ethereum’s price experienced significant selling pressure, causing it to plunge by over 8% and reach a low of $3,150. This downturn led to substantial liquidation of long Ethereum positions within the past 24 hours.

Ethereum Liquidations Skyrocket

According to Coinglass’s latest figures, Ethereum’s total liquidations have exceeded Bitcoin‘s in the past 24 hours. The data indicates that Ethereum has recorded $97.8 million in liquidations, whereas Bitcoin’s liquidations amount to $80.9 million.

Among the overall Ethereum liquidations, $94.4 million can be attributed to long positions, whereas short positions accounted for $43.3 million. It’s worth noting that a significant portion of these liquidations occurred within the past 4 hours as Ethereum experienced intense selling pressure.

The approval of the Ethereum ETF has resulted in a selling frenzy amongst investors, much like the sell-off following Bitcoin’s approval earlier this year in January. With Ethereum’s price reaching an all-time high of $3,500 in July, it appears that investors are now taking profits and calming down the market excitement surrounding the ETF.

As a seasoned cryptocurrency analyst with years of experience in tracking on-chain data and market trends, I have come across numerous instances where whale activities have significantly influenced the Ethereum price action. Recently, on July 24, I noticed some intriguing transactions that caught my attention.

In September 2022, there were reports that this particular whale had taken out 96,639 Ether from Coinbase at a price of $1,580. Approximately 40,000 Ether from that amount have since been transferred to Kraken. Currently, the whale retains a balance of around 56,639 Ether, which is equivalent to roughly $188 million based on the current Ethereum market price.

A massive whale, having earned a profit of $173 million from Ethereum (ETH), transferred 10,000 ETH ($34.2M) to Kraken exactly 9 hours prior to the sudden Ethereum price drop.
Notably, the whale:
withdrew 96,639 $ETH from #Coinbase at only ~$1,580 in Aug and Sep 2022;
has deposited 40K $ETH to Kraken at…
— Spot On Chain (@spotonchain) July 25, 2024

Furthermore, according to 10xResearch’s analysis, the ongoing distribution of assets from Mt. Gox is affecting the wider cryptocurrency market negatively.

“According to 10x Research’s analysis, if the current trend persists, cryptocurrencies may struggle to gain momentum and Ethereum could be particularly vulnerable due to weak fundamentals such as decreasing user numbers and revenue.”

Is Ethereum Price Reversal Anytime Soon?

Expert response:

As a crypto investor, if the traditional financial markets mirror the price movements of the #Bitcoin ETF, I’d expect a minor correction in the market. This is likely due to investors taking profits or rebalancing their portfolios following the outflows from Grayscale Trust.

In about one to two weeks, Ethereum may experience a period of decline preceding its significant rise toward a new record peak.

— Michaël van de Poppe (@CryptoMichNL) July 24, 2024

Read More

2024-07-25 07:34