Ethereum is still under heavy bearish pressure, with its ETH price crashing and short bets on its future plunging. The big news is that whale investors are taking flight or selling off their shares, resulting in a severe correction. Falling developer activity and dropping user engagement are contributing to the cryptocurrency’s woes.
Whale Investors Dump Ethereum
Ethereum’s descending resistance has set off a panic-induced selling spree among whales. For instance, World Liberty sold $8 million in Ethereum just last week, per Arkham Intelligence data. The Trump family crypto venture, meanwhile, is allegedly liquidating its Ethereum stake, resulting in heavy losses. This selling pressure coming from whale investors does nothing to relieve the overall bearish sentiment that surrounds Ethereum.
Technical Indicators and Market Sentiment
Ethereum’s price has plunged more than 40% since the beginning of February. On Tuesday, it was trading a little over $1,600, a 2% decrease in the past 24 hours. Options traders are the most bearish they have been on Ethereum’s prospects. For one trader, there’s $110 million riding on Ethereum’s price flopping in April. Fleeting is a trader’s bet, and traders are betting big—$110 million deep into contracts. They will be sending payouts if the price stays below $1,800 next month.
“Ethereum short sells are at an all-time high [as] institutions are driving the price down” - Zach Burks, CEO of Mintology
Network Activity Declines
Beyond price action, fundamental indicators show Ethereum network weakness. Weekly code contributions have plummeted 67% this year, a sign of withering developer activity. User activity is dying too, as the number of daily unique traders hits a 12 month low.
“It’s time to face reality,” said web3 marketer Stacy Muur last week. “This isn’t the ‘efficiency zone,’ I’m afraid. This is stagnation.”
Potential Beneficiaries
Given Ethereum’s current predicament, cryptocurrencies like XRP now stand to gain the most. If Ethereum is unable to bounce back, other platforms will likely bring in developers and users looking for more active ecosystems. Despite these obstacles, others are bullish on Ethereum’s longer-term prospects. BlackRock's digital assets chief, Robbie Mitchnick, stated in March that Ethereum was always going to be the bedrock for the asset manager’s tokenisation drive.
