Over the last two weeks, the cryptocurrency industry has witnessed an intriguing trend: Ethereum whales are “buying the dip,” demonstrating a highly optimistic position despite the market’s current fall. This deliberate action is reshaping the cryptocurrency environment, boosting Ethereum’s supremacy.
Four of the top wallet addresses purchased $94 million in ETH, Ethereum’s native coin, according to data. During last week’s market sell-off, the value of Ether fell with that of Bitcoin and other crypto assets.
Ethereum Whales Found the Best Opportunity to Buy ETH At Just $1.6k
Based on on-chain statistics, three of the four whales paid more than $30 million for 18,000 ETH, 17,900 ETH, and 18,200 ETH, respectively. The other won 2,000 ETH, which is valued at about $3.4 million.
Santiment, an economic intelligence tool, also reported an increase in whale activity for Ethereum during last week’s market downturn.
Particularly, addresses with 10-10k ETH increased their holdings dramatically as whale transactions reached 23k during the last week. This is the largest activity amount for this group of big holders, with 1,788 new addresses joining the group of holders.
Whales are crypto traders who own a big volume of digital assets. Their buying and selling habits may have a significant influence on markets, thus crypto analysts regularly monitor their activity to forecast market moves.
Due to tidal liquidations, ETH fell to its lowest price since June, reaching as low as $1,547 at a certain point late Thursday, down from almost $1,700 just hours earlier.
The cryptocurrency was in an extremely undervalued state at the moment, according to the relative strength index (RSI), since the bankruptcy of the FTX platform last November, which drove ETH below $1,000.
The Whales’ Reaction to the Market Downturn
Many investors become fearful and cautious during market downturns. Ethereum whales, or individuals or corporations who own a significant quantity of Ethereum, are taking a different strategy.
Rather than submitting to market forces, they are taking advantage of the value drop by acquiring massive amounts of Ethereum. This is a typical “buy the dip” approach, in which more of an asset is purchased when its value drops, with the idea that it would soon return and generate significant gains.
Santiment Data Analysis: The Indicators Show a Buildup of Ethereum
Santiment, a well-known blockchain data analytics startup, has been monitoring Ethereum whales’ actions. Their research demonstrates an important rise in the buildup of Ethereum by these businesses in recent weeks.
This pattern suggests that, while some investors may be discouraged by the recent market collapse, whales are not. They continue to add to their holdings, indicating their belief in Ethereum’s long-term potential.
Will the Price of Ethereum Rise Due to ETH Whale Buying?
The aggressive stockpiling of Ethereum whales has significant ramifications. For starters, their involvement contributes to Ethereum’s price stability, helping to mitigate the effects of market volatility. This consistency may attract additional investors, increasing Ethereum’s appeal and consolidating its market position.
Second, it implies that these whales have a high belief in the long-term worth of Ethereum. Their optimism could propagate to other investors, encouraging a good feeling toward Ethereum and perhaps hastening its price rebound.
Second Time The Price falls In The Same Month
Ethereum’s price has dropped drastically from its beginning yesterday (August 17), falling by 14.88% to its lowest position on August 18. This drop happened unexpectedly, leaving many people wondering where the price will go next.
According to a Twitter thread started by Lookonchain, BlockTower Capital transferred $5,000 in ETH worth $8.4 million to Coinbase to sell, while other whales purchased the dip.
Whales are accumulating $ETH from the bottom!
— Lookonchain (@lookonchain) August 24, 2023
4 whales accumulated 56.1K $ETH ($94M) in the past 7 days.
– 0x3CEE accumulated 18K $ETH($30M);
– 0x3478 accumulated 2K $ETH($3.4M);
– 0x5bA3 accumulated 17.9K $ETH($30M);
– smartestmoney.eth accumulated 18.2K $ETH($30.6M). pic.twitter.com/M93Mhkpn6p
Meanwhile, there has been an increase in whale-buying activity. On the drop, two whales purchased a total of 5,631 ETH worth $9.5M. One whale put 3998 ETH ($6.72M) in Compound and borrowed $5 million in stablecoins, only to repurchase 3,027 ETH ($5.09M) for $1,652.
Another user deposited $4 million in USDC to Binance and then withdrew $2,604 ETH ($4.4 million) after the market plummeted. Cumberland, a Whale, sold a total of 8K ETH (worth $14.4M) before the market crashed and then purchased back 4K ETH ($6.72M), transferring it from Binance.
Looking at the supply and demand distribution charts from Messari data, we can observe that whales have been expanding their holding rather than discarding. The price has already recovered over 10% of its drop, indicating that the whales have been providing support.
Closing Thoughts
Considering recent market turbulence, the acts of Ethereum whales present a positive picture for the future of Ethereum. Their active purchase amid a slump reflects a bullish attitude and unwavering conviction in Ethereum’s prospects.
While the market’s volatility may pose risks, it may also create possibilities for long-term investors. The active participation of whales serves as an indicator that Ethereum stays a key participant in the world of cryptocurrencies, capable of surviving market downturns while possibly reaping huge profits.
