Ethereum whales have accumulated $950 million in ETH: is the market preparing for a reversal?
Ethereum (ETH) made a confident rebound of 22% from its June low, holding above the key trend line for institutional investors — the monthly VWAP. This surge coincided with renewed capital inflows into spot ETH ETFs, which had been recording outflows for weeks.
Large holders continued to actively accumulate the cryptocurrency even during the decline, as confirmed by recent on-chain data. On the other hand, the rapid growth in the volume of borrowed funds raises doubts about the stability of this success. The market is now at a crossroads: has a real bottom formed, or is this another false bounce within a global downtrend?
Ethereum holds VWAP
On June 14, the ETH price rose above the monthly VWAP line — the volume-weighted average price. For major players, this indicator serves as a dividing line between the accumulation and distribution phases of assets. Previous VWAP breakouts led to similar results: after the April breakout, the coin rose by 19%, and 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 suggests that institutions begin actively buying at the first signs of an upward trend. Of course, it is difficult to establish a direct causal link here, but the correlation repeats regularly, and investors should closely monitor fund statistics.
Inflows into ETFs after a prolonged outflow streak
The sentiment reversal 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 amounted to $22.5 million. This positive result broke an extremely painful series of declines: 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. If the bottom is indeed confirmed, we could see a repeat of the positive scenario from May, when small amounts then grew into a streak of successful days. However, relying solely on ETFs would be a mistake, as key processes are now taking place directly within the network.
Whales continue buying, signs of capitulation fade
Large investors began accumulating coins even before the chart crossed the VWAP line. Whales steadily increased their positions, completely ignoring the local price decline. According to data from 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 bought coins worth a total of approximately $950 million.
Alongside this, on-chain metrics recorded a decline in seller activity. Mass market panic subsided around June 7, when the coin hit a local low. It was then that the net change in exchange positions went negative, signaling an outflow of coins from trading platforms. This investor behavior indicates a transfer of cryptocurrency to cold wallets for long-term storage.
Analysts from Swissblock noted in their recent Altcoin Vector report that Ethereum had 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 phase of selling appears to be truly behind us.
Key levels for Ethereum
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 jumped from $8.86 billion to $9.96 billion, and at its peak exceeded $10.27 billion. Typically, a reliable foundation for growth forms only after the complete liquidation of excess leveraged positions. Currently, we are seeing 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.
If a decline begins, the first support level will be $1,624, and the critical point is 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.
Expert opinion: The accumulation of $950 million in ETH by whales is a powerful bullish signal, but ignoring the risk of an overheated derivatives market is not possible. As long as open interest does not decline to comfortable levels, any positive scenario could be canceled by a sharp liquidation of long positions. Investors should remain cautious but closely monitor the $1,851 and $1,507 levels as key bifurcation points for the market.