Dormant Wallets Reactivate Amid Mounting Bearish Pressure
Glassnode data reveals ETH's active supply metric has hit a historic peak of 0.69, signaling long-term holders may be transferring tokens for potential sales. This reactivation of dormant accounts during weak market demand exacerbates Ethereum's downward trajectory.
Key observations:
- On-chain activity dropped sharply from 27.99 million ETH on May 6 to ~25 million ETH
- Weak buy-side momentum combines with reduced capital inflows
- Critical support levels at $2,185 and May lows await if selling persists
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ETF Outflows Magnify Short-Term Risks
Farside Investors reports concerning ETF movements:
- June 20 saw $11.3M net outflows from Ethereum ETFs
- ETH A led withdrawals with $19.7M single-day exodus
- Minor inflows recorded in ETH ($6.6M) and ETHV ($1.8M) funds
- Other ETFs showed negligible activity
Liquidation Wave Hits Ethereum Markets
24-hour market snapshot:
- $170M total ETH contract liquidations
- Long positions accounted for $157M (92%) of losses
- Santiment detects abnormal ETH deposits to centralized exchanges
- Downward pressure may persist without corresponding buy-side support
$2,500 Resistance Emerges as Critical Threshold
Technical analysis highlights:
- Moving averages (10D-30D) uniformly signal sell conditions
- Price remains constrained below $2,500 resistance zone
- Breakthrough potential requires ETF inflows and sustained buying
Upside scenarios:
- $2,800-$2,850 breakout could enable $3,000 tests
Downside risks:
- $2,280 support becomes vulnerable if macro conditions worsen
FAQ: Understanding the Ethereum Sell-Off
Q: Why are long-term ETH holders selling now?
A: Multiple factors including profit-taking after recent rallies, reduced DeFi activity, and anticipation of ETF-related volatility may be driving exits.
Q: How do ETF flows impact ETH price?
A: Substantial outflows reduce institutional demand while increasing circulating supply, creating downward price pressure.
Q: What's the significance of $2,500 resistance?
A: This psychological and technical barrier represents the convergence of moving averages and historical trading volume that must break to establish bullish momentum.
Q: Are whale wallets participating in the sell-off?
A: On-chain data suggests both institutional and large retail holders are contributing to current selling pressure through exchange deposits.
Q: Could this downturn represent a buying opportunity?
A: Historically, ETH has rebounded strongly from oversold conditions, but careful risk assessment remains essential given macroeconomic uncertainties.