Ethereum whales have scooped up $950 million worth of ETH: Is a bottom forming or is this a trap?
The price of Ethereum (ETH) has rebounded 22% from its June low, holding above a key trend line for institutional investors. This rally coincided with renewed inflows into spot ETH ETFs, which had recorded weeks of outflows. Against this backdrop, large holders continued to actively accumulate the cryptocurrency even during the downturn, as confirmed by recent on-chain data. However, the rapid increase in leverage volume raises doubts about the stability of this success.
Ethereum Holds the Monthly VWAP Line Again
In mid-June, specifically on the 14th, the Ethereum price rose above the monthly VWAP line. This volume-weighted average price serves as a dividing line for major players between the accumulation and distribution phases of assets. Previous breakouts of this indicator led to similar outcomes. For example, after the April breakout above VWAP, the coin appreciated by 19%, while the May breakout brought a more modest 7% gain. Notably, in both cases, capital inflows into spot ETFs resumed a few days after the breakout. This dynamic indicates that institutions begin actively buying at the first signs of an upward trend.
Spot ETF Flows Turn Positive Again After a Tough Streak
The shift in sentiment came at a very opportune time. Literally the day after the price held above the VWAP line, on June 15, net inflows into spot ETH ETFs reached $22.5 million. This positive result broke an extremely painful series of declines. In fact, from May 11 to June 12, capital outflows were recorded almost daily, with only two trading sessions as exceptions. For comparison, the situation looked much better in early May: on May 1, funds attracted $101 million, and on May 5, another $98 million. Currently, the total net assets under management are approaching the $10.04 billion mark.
Whales Continue Buying, Signs of Capitulation Fade
Large investors began accumulating coins even before the chart crossed the VWAP line. Whales systematically increased their positions, completely ignoring the local price drop. According to analysts at Santiment, since June 10, the balances of millionaire wallets have grown from 124.85 million ETH to 125.4 million ETH. Thus, in just one week, they purchased coins worth a total of approximately $950 million. Concurrently, on-chain metrics recorded a decline in seller activity. Mass market panic subsided around June 7, when the coin found a local low. It was then that the net position change on exchanges turned negative, signaling an outflow of coins from trading platforms. This investor behavior indicates a transfer of cryptocurrency to cold wallets for long-term storage. As a result, a seller deficit has formed in the market, which usually heralds an imminent trend change.
Key Ethereum Levels
Currently, Ethereum is trading around $1,771, holding above the monthly VWAP, which is at the $1,705 level. Since the beginning of June, the coin has gained about 22% from its low of $1,507, but this is still insufficient for a definitive reversal. To confirm an upward trend, buyers need to close a daily candle above the resistance at $1,851. This would allow the asset to return to its previous trading range. The main danger now lies in excessively high leverage. The total open interest in ETH futures has surged from $8.86 billion to $9.96 billion, peaking above $10.27 billion. Typically, a reliable foundation for growth forms only after the complete liquidation of excess leveraged positions. Currently, we are observing the opposite process—open interest is rising along with the price. Overloaded long positions could trigger a wave of forced liquidations at the slightest downward movement, so it is too early to talk about the end of capitulation.
My analysis: The accumulation of $950 million in ETH by whales is a powerful bullish signal, indicating the confidence of major players in the asset's long-term potential. However, the growing open interest amid the price recovery creates an extremely vulnerable structure. If ETH cannot confidently break through the $1,851 level, we risk seeing a sharp correction that would liquidate excess leverage and potentially lead to a test of lows around $1,500. The true bottom will only be confirmed after the market "sheds" the overheating in derivatives.