Ethereum whales have accumulated $950 million: a signal of a bottom or a trap before a new decline?
Ethereum (ETH) rebounded 22% from its June low, holding above a key trendline for institutional investors. This momentum coincided with renewed capital inflows into spot Ether ETFs, which had been recording outflows for weeks. However, beneath the facade of optimism lie alarming signals from the derivatives market.
Large holders, known as "whales," continued to aggressively accumulate the cryptocurrency even amid the recent downturn. According to fresh on-chain data, since June 10, the balances of millionaire wallets have grown from 124.85 million ETH to 125.4 million ETH. Over the week, they purchased coins worth approximately $950 million. This is a powerful bullish signal, indicating the confidence of "smart money" in the asset's long-term potential.
ETFs Turn Around: From Outflows to Inflows
The shift in sentiment came at a crucial time. On June 14, the ETH price held above the monthly VWAP (Volume-Weighted Average Price) line, and the very next day, net inflows into spot Ether ETFs amounted to $22.5 million. This broke a painful streak of outflows that had lasted from May 11 to June 12. For comparison, at the beginning of May, funds attracted $101 million in a single day. If this dynamic repeats, we could witness a new wave of institutional demand.
The total net assets under management for ETFs are already approaching the $10.04 billion mark. However, relying solely on ETFs would be a mistake, as key processes are currently unfolding directly on the network.
Seller Capitulation: Signs of Exhaustion
Widespread market panic subsided around June 7, when ETH found a local bottom. The net change in exchange positions indicator turned negative, signaling an outflow of coins from trading platforms. This points to the transfer of cryptocurrency to cold wallets for long-term storage. Whales are swiftly buying up any available supply, creating a supply deficit. Analysts at Swissblock noted in their Altcoin Vector report that Ethereum has been in a capitulation phase for a long time, which often precedes a powerful price reversal.
Main Threat: Overheated Derivatives Market
The primary danger lies in excessively high leverage. The total open interest in ETH futures surged from $8.86 billion to $9.96 billion, peaking above $10.27 billion. The rise in open interest alongside price 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 declare the end of capitulation.
My analysis: The whales' accumulation of $950 million is undoubtedly a bullish signal, but it does not negate the risks from derivatives. To confirm an upward trend, buyers need to confidently close a daily candle above the resistance at $1,851. Only this will allow distinguishing a true bottom from a temporary bounce within a global downtrend. For now, the market is balancing on a knife's edge.