Ethereum price dips as whales continue to off-load the altcoin in lieu of short-term gains
The total number of wallets containing 1,000 ETH or more has dropped significantly over the course of 2021.
- Technical analysts believe there is a possibility of ETH dropping as low as AUD$4,400 in the near term.
- Ethereum's market dominance index (DI) currently stands at 19.1%.
- Kraken CEO Jesse Powell revealed his company's plans to start issuing loans against privately held NFTs by early 2022.
The last 7-day stretch has been quite tumultuous for Ethereum, with the altcoin seemingly regaining support around the AUD$5,650 range only to fall back once again quite sharply. As a result, the world's second-largest cryptocurrency by total market capitalisation has registered monthly losses of over 10%. At press time, ETH is trading at a price point of AUD$5,285.
Elaborating on Ethereum's ongoing financial descent, on-chain data released by Glasnode shows that whales have been dumping the altcoin ever since it dipped past the AUD$5,550 (US$4,000) range recently. In this regard, the total number of wallet addresses holding at least 1,000 ETH has continued to dip, reaching its lowest ever levels since 2017.
As the number of ETH whales continues to decline, experts believe that the trend may point to the fact that investor confidence in the digital asset may be dipping somewhat. In fact, the aforementioned study shows that the number of Ethereum addresses holding 10,000 ETH or more (approx $40 million) — representing a section of individuals who are the altcoin's most hardcore backers — has also dipped by nearly 4.5%.
In terms of where the market may be headed, independent analyst Pentoshi believes that ETH may have finally found its local bottom, even though there are some technical indicators suggesting that the altcoin may dip as low as US$3,200 in the near term. On a cautious note, he added:
"I don't like when the market gives these many opportunities to buy an area with important historical context like this. Would rather pay for confirmation."
New investors continue to accumulate ETH
Despite seasoned veterans cashing out their ETH holdings in recent weeks for near-term gains, Glassnode researchers revealed that the total number of wallet addresses with a non-zero ETH balance — or storage units with at least 0.01 ETH — is currently at an all-time high at 71.23 million.
Even the number of wallets in possession of at least 0.1 ETH (approx. US$400) has more than doubled over the past year, jumping from 3.62 million to a little over 6.4 million.
DeFi tokens provide shelter from the storm
As the market continues to be faced with a massive drawdown, with many prominent alts losing a lot of value, it appears as though the decentralised finance (DeFi) market has continued to accrue value, with OG Fan Token, Aragon, QuickSwap and Harvest Finance logging gains of 31%, 32%, 35% and 121% respectively.
Lastly, Jesse Powell, co-founder and CEO of cryptocurrency exchange Kraken, revealed in a recent interview that his firm will soon be launching a fully functional non-fungible token (NFT) marketplace that will allow clients to borrow money in relation to their personal NFT holdings. It is estimated that Kraken will make its much-hyped NFT debut sometime during Q1 2022.
Interested in cryptocurrency? Learn more about the basics with our beginner's guide to Bitcoin, dive deeper by learning about Ethereum and see what blockchain can do with our simple guide to DeFi.
Disclosure: The author owns a range of cryptocurrencies at the time of writing.
