Ethereum: These 4 ‘culprits’ fueled sell-offs, 7% price fall

• Institutions sold ETH worth $105 million during the latest correction
• On-chain data suggested the decline could be an opportunity to buy before another rally starts

Four whales including notable institutional investors took part in selling off some of their Ethereum [ETH] holdings as the altcoin’s price collapsed on the charts. In fact, ETH depreciated by over 7% in just 24 hours.

According to Lookonchain, Cumberland, a trading firm, sent a total of 17,206 ETH to exchanges. At the time of the transactions, the coins were worth $57.3 million. FTX also deposited $8.33 million worth of ETH to Binance. Finally, the other two institutions sold a combined $39.92 million in ETH.

Source: X

Only the short-sighted may be affected

Whales sell their assets for different reasons. For some, it could be a normal profit-taking event. For others, it could be an avenue to let go after a cryptocurrency has underperformed. However, this altcoin does not seem to fall into this category.

At the time of writing, AMBCrypto could not confirm why the parties sold. But one thing was certain— The sell-offs played a big role as Ethereum’s price fell to $3,169. At press time, ETH was valued at $3,262, indicating that the cryptocurrency recovered slightly. However, it is important to check if the cryptocurrency can sustain this mild uptrend

To do this, AMBCrypto looked at some metrics which could affect the value. First on the list was the Mean Dollar Invested Age (MDIA).

The MDIA is the average age of coins held in the same wallet. If the metric increases, then it means many coins are less active, and have remained in the same place for a long while. On the other hand, a falling MDIA implies that old coins are moving. For Ethereum, on-chain data from Santiment revealed that the 90-day MDIA spiked.

Historically, a massive decline in the metric was accompanied by a local top. Therefore, the recent increase suggested that ETH could be undervalued, and the latest correction could be a chance to buy at lower prices before its potential rally

Source: Santiment

Is the next path great?

Network growth was another metric AMBCrypto analyzed. This metric gauges user adoption over time. If it increases, then it means a project is gaining traction. If it decreases, it implies that the project is losing traction.

On 12 April, Ethereum’s network growth was 128,000, indicating that a lot of new addresses interacted with the project.

However, it seemed that the price decline caused the number to fall to 36,100. If network growth improves, demand for ETH might help the price action jump.

Conversely, a decline in the metric could result in stagnancy for the value. In addition, the one-day circulation dropped to 230,000, reinforcing the notion of decreased usage.

Source: Santiment

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That being said, the drop in circulation could be good for ETH as it could be a sign of less selling pressure. Should the number of coins used continue to fall, then ETH’s price might exit the awful state it has been in over the last 24 hours.