Ethereum Struggles to Maintain $4,200 Amid $4B Supply Overhang
Ethereum (ETH) is currently struggling to maintain a price above $4,200 following a sell-off that led to significant liquidations in the crypto market. Key points include:
- ETH has decreased nearly 9% over the past week, with traders anticipating a potential retest of the $4,100 level.
- Over the last 24 hours, more than $178 million in positions were liquidated, primarily affecting long ETH traders with over $127 million lost.
- A trader on Hyperliquid reported a loss of nearly $6.2 million after aggressively re-entering ETH longs.
- The staking withdrawal queue for Ethereum has surged to 910,461 ETH, valued at approximately $3.91 billion, indicating potential supply pressure on prices.
Institutional Investors Step in Despite Market Jitters
- Large institutional investors are capitalizing on the dip; Bitmine Immersion purchased 52,475 ETH, raising its total holdings to nearly $6.6 billion.
- SharpLink acquired 143,593 ETH at $4,648, although this position is currently underwater.
- New inflows from FalconX-linked wallets exceeded $38 million, indicating continued accumulation by large investors despite short-term volatility.
Analysts Warn of Deeper Losses Before Recovery
- Experts advise caution as Ethereum may face further pressure due to macroeconomic uncertainties and the upcoming U.S. Federal Reserve's Jackson Hole meeting.
- Active Ethereum addresses have declined nearly 28% in August, reflecting reduced retail participation and slowed network growth.
- Despite current challenges, some analysts project Ethereum could reach between $6,000–$8,000 by year-end if institutional investments continue.
The critical question remains whether ETH can maintain its value above $4,000 or face deeper corrections due to supply pressures.