Ethereum whales have accumulated $950 million: is a bottom forming for ether?
The price of Ethereum (ETH) has rebounded 22% from its June low, holding above a key trend line for institutional investors. This surge coincided with renewed inflows into spot ETH ETFs, which had recorded capital outflows for weeks prior.
Large holders continued to actively accumulate the cryptocurrency even during the decline, as confirmed by fresh on-chain data. However, the rapid growth in the volume of borrowed funds raises doubts about the stability of this success. Experts debate whether the market has formed a real bottom or if this is another false bounce within a global downtrend.
Return to the VWAP Line and ETF Awakening
On June 14, 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 results: the April breakout above VWAP yielded a 19% gain, while the May one saw a more modest 7%.
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 uptrend. The correlation repeats regularly, so investors should closely monitor fund statistics.
ETF Inflows: A Turning Point After a Prolonged Outflow Streak
The shift in sentiment came at a very opportune time. Literally the day after the price consolidated above the VWAP line, on June 15, net inflows into spot ETH ETFs reached $22.5 million. This result broke a highly painful series of declines: from May 11 to June 12, capital outflows were recorded almost daily, except for just two trading sessions. For comparison, the situation looked much better in early May: on May 1, funds attracted $101 million, and on May 5, another $98 million.
The total net assets under management are approaching the $10.04 billion mark. If a market bottom is confirmed, we could see a repeat of the positive scenario. However, relying solely on ETFs would be a mistake, as key processes are now occurring directly within the network.
Whales Buy While Sellers Disappear
Large investors began accumulating coins even before the chart crossed the VWAP line. Whales systematically increased their positions, completely ignoring the local price decline. According to data from Santiment analysts, 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 bought coins worth a total of approximately $950 million.
Simultaneously, 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 indicator on exchanges turned negative, signaling an outflow of coins from trading platforms.
Such investor behavior points to the transfer of cryptocurrency to cold wallets for long-term storage. This trend is supported by large whales who promptly buy up any available volumes. As a result, a seller deficit has formed in the market, which usually heralds an imminent trend change.
Analysts at Swissblock noted in their recent Altcoin Vector report that Ethereum has been in a capitulation phase for a long time. This state of strong market pressure often precedes a powerful price reversal. The current reduction in exchange balances confirms that the acute selling phase appears to be truly behind us. Nevertheless, the overall picture is significantly marred by the situation in the derivatives market.
Key Levels and Hidden Threats
Currently, Ethereum is trading around $1,771, holding above the monthly VWAP, which stands at $1,705. 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 uptrend, 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 witnessing the opposite process—open interest is rising along with the price. This situation indicates the dominance of margin traders rather than genuine demand in the spot market. 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.
If a decline begins, the first support level will be $1,624, with the critical point being the low of $1,507. A daily close below this mark would force the market to seek new lows. Only a confident breakout of the $1,851 barrier will help distinguish a true bottom from a temporary bounce.
My comment: The accumulation of $950 million by whales is a powerful bullish signal, but the rising open interest in futures adds volatility. The market is currently balancing on the edge: either we will see a breakout of $1,851 and consolidation, or a wave of long liquidations will take ETH below $1,500. Keep an eye on spot volume—it is now more important than derivatives.