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The Ethereum Merge is only about two days away according to the difficulty adjustment, and sentiments around ETH during this time have been peaking. Most of this has been on the bullish side, but some things that have taken place in the market have begun to trigger some negative sentiment from investors. Mostly, these have been large whale transactions being moved onto centralized exchanges, causing fears that there might be massive dumps on the way.
Ethereum Whale Transaction Ramp Up
Ahead of the Merge, the activity from Ethereum whales has been on the rise. Most notable of these have been the large transactions that have moved ETH onto centralized crypto exchanges such as Binance. Naturally, investors have begun to worry whether these transactions were random or a coordinated dump effort.
The first transaction that raised eyebrows was a total of 150,811 ETH that was moved from an unknown wallet to another unknown wallet, which was later identified as being moved from OKEx exchange to Binance. At the time of the transaction, the dollar value of the transaction was $259.78 million. While this would’ve not been a big deal on its own, other large transactions to centralized exchanges would quickly follow.
Another 29,879 ETH worth $51.47 million was then transferred from an unknown wallet to the OKEx exchange. The next transaction carried 119,515 ETH worth $207.6 million from an unknown wallet to the Binance exchange.
22,397 ETH worth $38.56 million was then transferred from Bitfinex to an unknown wallet. While another large transaction of 37,499 ETH worth $64.57 million was transferred from an unknown wallet to another unknown wallet. All of these transactions had taken place within one hour, sparking rumors of a dump coming after the Ethereum Merge is completed.
ETH trading below $1,600 | Source: ETHUSD on TradingView.com
Are Whales Dumping ETH?
These large transactions that are carrying massive amounts of ETH onto centralized exchanges paint a bearish picture for the digital asset in the short term. Now, the Ethereum Merge has drummed up a lot of hype, but it, too, is starting to look like another “buy the rumor, sell the news” event.
If this is so, then the price of ETH is likely to dump from these large whales shedding their holdings following the Merge. A lot of ETH had also been accumulated because investors had wanted to take advantage of the ETH airdrops that would come from the hard forks. However, once the Merge is complete, there would be no need for these investors to hold their ETH, and many will likely dump them.
It should also be kept in mind that these are the transactions that are being tracked across centralized exchanges. Others choose to go the centralized route, where they will also likely dump. However, centralized exchanges offer the most liquidity for such large trades.
To be best prepared, investors should keep an eye on the ETH charts following the Merge and ensure to have adequate risk management for events that are especially as popular as this one.
Featured image from The Cryptonomist, chart from TradingView.com
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