The recent sale of significant quantities of Ethereum by Vitalik Buterin and the Ethereum Foundation raises questions about market dynamics and the price outlook of the crypto.
Let’s see all the details below.
Analysis of Vitalik Buterin’s sale of Ethereum and the price of the crypto
The co-founder of Ethereum, Vitalik Buterin, recently transferred about 10 million dollars worth of Ether to cryptocurrency exchanges.
This movement was accompanied by significant sales from the Ethereum Foundation, which sold Ether for over 200 million dollars.
These transfers have fueled speculations about their implications for the Ethereum market, especially considering the recent price trends of the cryptocurrency.
According to the data from Arkham Intelligence, Buterin’s Ether address has seen significant outflows in recent years, with movements exceeding 840,000 ETH in the last two years alone.
This has led some observers to speculate that such sales may be profit-oriented, especially in a market that has seen a 180% increase from the cycle low of $885 in 2022.
However, Buterin has rejected these accusations, stating that he has not sold Ether for profit since 2018. He emphasized that every transfer of ETH has supported projects within the Ethereum ecosystem and broader charitable initiatives.
How to interpret the recent sales?
The significant sales of Ether by Buterin and the Ethereum Foundation have raised questions about the future direction of Ether prices.
Historically, transfers of large quantities of Ether have often caused short-term market reactions, with investors interpreting these actions as potentially inflationary selling pressure.
For example, previous sales by the Ethereum Foundation have coincided with significant price corrections of Ether.
In 2021, the sale of 350,000 ETH preceded a 50% reduction in the Ether markets. However, not all sales by the Ethereum Foundation have led to market corrections.
In December 2020, a sale of 100,000 ETH was followed by a 630% rally in Ether prices, catalyzed by the launch of the Beacon chain and the growing interest in cryptocurrencies as a risk asset.
Brief focus on the price of the crypto
Currently, while the US Fed plans interest rate cuts and outflows from Ethereum exchange-traded funds (ETF) slow down, Ether’s price outlook is influenced by a series of technical factors.
The recent pullback from the 50-week EMA could indicate a possible decline towards the 200-week EMA, with the price potentially dropping to around $2,000.
However, this support area is reinforced by the lower trendline of a multi-year ascending triangle pattern.
Suggesting therefore a potential significant rebound that could lead Ether to test the upper trendline of the triangle around $4,000 by the end of 2024 or the beginning of 2025.
In conclusion, the recent sales of Ether by Vitalik Buterin and the Ethereum Foundation raise crucial questions about the market dynamics of Ethereum.
Investors are advised to closely monitor these developments as they evaluate their long-term strategies in the context of an evolving crypto market.
