Lookonchain data on February 20 shows that an Ethereum whale and one of the early investors who participated in the 2014 Initial Coin Offering (ICO) cashed out when prices briefly breached $3,000.
ETH Whale Exits At $3,000: Bullish or Bearish?
Before today’s liquidation, on-chain data shows that the whale, who acquired 3,465 ETH for approximately $10.30 during the ICO, remained dormant for 8.6 years. Then, each token was available for $0.31.
However, the whale jumped back to life when prices briefly roared above $3,000 during the early New York session on February 20. The address, Lookonchain, notes, transferred 1,732 ETH, worth approximately $5.15 million at current prices, to Kraken, a cryptocurrency exchange. When the whale exited at around $3,000, the return on investment stood at over 9,600X.
The transfer, as expected, remains a source of discussion and speculation. With Ethereum posting stellar gains recently, the move was possibly a profit-taking event. Even so, considering that massive transfers to centralized exchanges are a bearish sign, $3,000 can be interpreted as local resistance.
This assumption can be valid because, despite the recent sharp upswings, ETH bulls have failed to break above $3,000. The last time buyers were trending in this zone was in early 2022. Then, it was after the correction from the all-time highs of around $5,000 recorded in 2021 and before the crash that forced the coin below $1,000 in late 2022.
Since then, ETH prices have more than doubled, rising in 2023 and sustaining gains in early 2024. Whether the uptrend will continue in the months ahead, marked by ETH blasting above $3,000 towards $5,000, remains to be seen.
Ethereum Dominates DeFi, Preparation For Dencun Upgrade
ETH traders are overly bullish on what lies ahead. Most cite the network’s dominance as an enabler of decentralized finance (DeFi) and other on-chain activities, including non-fungible token (NFT) minting. DefiLlama data shows that over $76 billion of assets are managed by various DeFi protocols led by Lido Finance, a liquidity staking platform.
Besides the popularity of Ethereum, network updates are also positive developments. So far, developers are preparing for the mainnet implementation of Dencun. The update introduces proto-danksharding, a critical step before sharding.
Through sharding, Ethereum plans to scale on-chain by splitting the network into interoperable “shards” that can process transactions. In this model, the network will process more transactions at a go, allowing the platform to host even more intensive protocols.
Feature image from Canva, chart from TradingView
