The crypto market often runs on a cycle of highs and lows. Conscious investors leverage the lows to enrich their wallets with assets awaiting the bull run. This quarter’s bearish trend is no exception.
The past few weeks in the crypto market have been filled with massive losses following the FTX collapse. The extreme macroeconomic conditions following the Fed’s interest rate hike are not helping matters.
Ethereum, the second-largest cryptocurrency, suffered multiple setbacks in the last weeks following the market decline. Ethereum slumped below $1,600 to $1,081, losing nearly 24% over the weekend.
Ether whales took note of the bearish trend and accumulated over $1 billion worth of ETH while the price went below the support level.
Whales Buy A Major Amount Of Ethereum
According to Santiment, Ethereum whales accumulated nearly 947,940 ETH worth over $1 billion in the current market price. The “Percentage of Supply Held” data for Ethereum indicates the move as the most significant single-day whale accumulation in the last year.
In previous accumulations, Ethereum’s price rose by an average of 3.2% against BTC. Bitcoin whale accumulations at support levels often trigger a bullish price reversal, but the opposite happened this time.
This is because Ethereum still suffers the effect of the FTX contagion. The FTX collapse hit the cryptocurrency as the crypto exchange suffered ETH shortages, leading to insolvency.
Former CEO of FTX Sam Bankman-Fried’s Alameda Research transferred a large amount of ETH to the exchange to save the situation. However, the attempts failed as both firms filed for bankruptcy a few days later.
The FTX hacker didn’t help, as he attacked the exchange’s accounts and carted away many assets. The account drainer later converted all the assets to Ethereum, raising speculations that the hacker’s wallet address belonged to an insider. However, days later, the hacker dumped all the stolen ETH for Bitcoin, causing further sell pressure on Ethereum.
Two Largest Cryptocurrencies Fall To New Lows
Given the unfortunate events, Ethereum price continued tanking amid the crisis down to the support levels before the whale accumulation. Ethereum now trades at $1,165 with gains.
However, despite the massive loss, Ethereum has shown signs of recovery as its price added 2% in the last few hours. Meanwhile, Bitcoin itself is not doing so well. Last Tuesday, the largest cryptocurrency hit its four-month low at $17,656 after plunging 10%.
The asset continued downward, hitting a week low on Monday and dragging other cryptocurrencies. According to Coin Metrics, Bitcoin traded at $15,725.02 and later fell to 15,586.94, the lowest since November 10. However, BTC recovered a bit and is now trading at $16,515 with minor gains.
Featured image from Pixabay, chart from TradingView.com