On-chain data shows that ethereum whales recently went on a $425 million acquisition spree, a sign that could be positive for the asset.
Recently, Ethereum whales participated in fundraising
As analyst Ali noted in a report postal On X, ETH whales have made some large purchases recently. The relevant metric here is “ETH supply distribution,” which tracks the total supply held by each investor group.
Investors or addresses are divided into these groups based on the total number of tokens held in their balances. For example, the 1 to 10 token group includes all investors holding at least 1 and at most 10 ETH.
In the context of the current discussion, the group of interest is whales. Wallets for these large holders can be assumed to range from 10,000 to 100,000 coins.
Since whales hold large amounts of money in their wallets (the low end of the range is about $16.3 million and the high end is $163 million), they can naturally become influential entities on the network.
Now, the chart below shows how the total supply held by Ethereum whales has changed over the past week:
Looks like the value of the metric has observed some uplift in recent days | Source: @ali_charts on X
As the chart above shows, the supply held by Ethereum whales has recently seen a significant increase. During this pump, these massive holders bought about 260,000 ETH in 24 hours, worth about $423 million at current exchange rates.
With this latest buying spree, the group’s total supply has reached approximately 27.03 million ETH, meaning these investors now hold approximately 22.5% of the cryptocurrency’s entire circulating supply.
This accumulation of Ethereum whales is naturally a constructive sign for the coin, as it means that these holders are supporting the current price and thus the likelihood of a rally may increase.
However, the analyst noted that ethereum’s current price is risky as not many investors have a cost base at this level.
The density of investors who purchased at the different ETH price levels | Source: @ali_charts
The data above shows the number of investors buying in each Ethereum price range. From this, it can be seen that current levels are relatively low for holders, and the range below does not encompass the cost basis of that many holders.
The densest group is in a price range slightly above the current price range, meaning that at current prices, all of these investors lose money on average.
Generally, areas of high concentration of cost bases support prices, but no such areas exist in the lower ranges. Ali noted that this could lead to a pullback to the next level of $1,200 with some support.
Buying from whales at current prices is naturally a step in the right direction for the asset, but it still needs to revert back a bit to a more dense cost base area if it has to build a solid rally.
Ethereum price
As of this writing, Ethereum is trading around $1,600, down 5% over the last week.
ETH has continued to trade sideways recently | Source: ETHUSD on TradingView
Featured image via Todd Cravens on Unsplash.com, charts via TradingView.com, Santiment.net
