Ether Falls 9% as Long-Term Holders Accumulate; Institutions Sell
Ether slid about 9% to a low near $2,165 on Feb. 2, wiping more than $25 billion off its market cap and extending a weekly decline to roughly 23%. On-chain data shows a divergence: institutional entities are reducing exposure while long-term holders and OTC buyers are accumulating. Trend Research deposited 53,589 ETH (~$120M) to exchanges in 24 hours and withdrew 77.5M USDT to repay Aave loans, though it still holds 418,045 ETH. Bitmine, holding ~4.24M ETH at an average cost of $3,882, faces more than $6B in unrealized losses. Conversely, two dormant “Ethereum OG” wallets reactivated, deposited 44,490 ETH into Aave, borrowed 104M USDT and used looped borrowing to buy 45,319 ETH at an average price of ~$2,295. An OTC whale also purchased 30,392 ETH (~$70M). The sell-off triggered large liquidations and pushed ETH below its 200-day SMA — a level that previously acted as a key pivot. Analysts cite support in the $1,850–$1,550 range and label the current zone a buying opportunity; some maintain long-term targets (e.g., $10,000). As ETH falls, investor interest is shifting toward new projects like Bitcoin Hyper (HYPER), which has raised ~$31M in its presale and markets itself as a Solana-based Layer 2 for Bitcoin.
Bearish
The immediate market impact is bearish. A near 9% one-day drop, $25B+ market cap loss, and ETH breaking below the 200-day SMA signal heightened short-term risk and momentum for further downside. Large liquidations amplify volatility and can produce cascading selling. Institutional deposits to exchanges (Trend Research) indicate supply-side pressure, while Bitmine’s significant unrealized losses can limit their capacity to add buy-side support. Offsetting forces—long-term holders reactivating and OTC/OG buys—provide demand and may stabilise price, but their actions often reflect opportunistic accumulation rather than broad-based buying. Historically, similar events (sharp drops below major moving averages) have led to continued short-term weakness before consolidation and eventual recovery when selling exhausts and on-chain accumulation grows (e.g., ETH’s March 2025 dip followed by a multi-month rally). Traders should expect elevated volatility: short-term setups favor risk management (tight stops, reduced leverage), while swing traders may watch for confirmed support in the $1,850–$1,550 zone and signs of declining liquidation pressure before initiating larger longs. The emergence of presale interest in alternative projects (HYPER) suggests some capital rotation away from top assets, which can mute a swift ETH rebound.