Ethereum News

Ethereum Faces Selloff Risks As Whales’ Unrealized Profit Hits 2021 Highs

Ethereum risks falling to $4000 as ETH whales' unrealized profit hits the previous cycle’s peak amid spot Ethereum ETF outflows.
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Ethereum Faces Selloff Risks As Whales’ Unrealized Profit Hits 2021 Highs

Highlights

  • Ethereum risks falling as historical data signal whales could start profit booking soon.
  • It coincides with spot Ethereum ETFs outflows and bearish forecast by Citigroup.
  • Analysts predicts ETH price risks correction to $4,000.

Ethereum could face a choppy path ahead as whales continue to book profits when ETH price moves higher. While the Federal Reserve resumes its interest rate cuts, the latest selloff by whales, Citigroup’s bearish outlook, and outflows from spot Ethereum ETFs signal significant headwinds towards $5,000.

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Ethereum Whales On-chain Data Sparks Concerns

CryptoQuant on September 18 highlighted that unrealized profit of Ethereum whales holding 10K–100K ETH climbed to levels witnessed during the previous cycle’s peak in 2021. The level is often considered a benchmark by whales to book some profits.

Historically, such higher unrealized profits of whales could trigger profit-taking activity or increased selling pressure in the crypto market. Notably, long-term holders have continued to cut their holdings in the last few months.

While this doesn’t indicate an immediate or sharp correction, investors must consider historical data on whale behavior that could heavily influence price action, per CryptoQuant analyst.
ETH Unrealized Profit by Balance. Source: CryptoQuant
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Institutions and Whales Keep Selling Ethereum

Spot Ethereum ETFs recorded a net outflow of $1.89 million on Wednesday, indicating selling by institutional investors despite a 25 bps Fed rate cut. Fidelity’s FETH saw an outflow of $29.19 million and Bitwise’s ETHW saw $9.7 million in outflow, as per Farside Investors data.

Moreover, Onchain Lens highlighted a whale moving its entire 5,000 ETH holdings worth $22.84 million to crypto exchange Binance. The whale made an overall profit of $5.08 million.

Whale 5K ETH Selloff. Source: Onchain Lens

As CoinGape reported earlier, Wall Street giant Citigroup remains bearish on Ethereum. The bank predicted ETH price to end this year at $4,300, while also sharing a bearish case target of $2,200. It added that macroeconomic factors have contributed moderately to the ETH price rally above $4,500.

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Analysts Predict ETH Price Could Fall to $4,000

Analyst Ted Pillows pointed out that ETH price is still consolidating below its $4,700 resistance. Ethereum needs to rebound above the level to avert a correction towards $4,000.

Ethereum in the Daily Timeframe. Source: Ted Pillows

Moreover, analyst Ali Martinez pointed out that the TD Sequential indicator has flashed a sell signal on Ethereum. He predicted ETH price to drop to $4,570 again. This indicates multiple headwinds, along with technical indicators, signal a potential drop in Ethereum.

ETH price soared 2% in the past 24 hours, with the price currently trading near $4,600. The 24-hour low and high are $4,429 and $4,643, respectively. Trading volume has increased by 28% in the last 24 hours.

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Varinder Singh

Varinder is a seasoned leader in the fintech and crypto media with over 12 years of experience, including over 6 years dedicated to blockchain, crypto, and Web3 developments. He is known for covering high-impact and quality news stories for publishers such as CoinGape, The Coin Republic, and The Crypto Times, while perfecting and training multiple journalists during his tenure. Being a Master of Technology degree holder, analytics thinker, and tech enthusiast, he has shared his knowledge of disruptive technologies in over 5000 news articles and papers.

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Why trust CoinGape: CoinGape has covered the cryptocurrency industry since 2017, aiming to provide informative insights to our readers. Our journalists and analysts bring years of experience in market analysis and blockchain technology to ensure factual accuracy and balanced reporting. By following our Editorial Policy, our writers verify every source, fact-check each story, rely on reputable sources, and attribute quotes and media correctly. We also follow a rigorous Review Methodology when evaluating exchanges and tools. From emerging blockchain projects and coin launches to industry events and technical developments, we cover all facets of the digital asset space with unwavering commitment to timely, relevant information.
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