Ethereum Founder's Asset Liquidation Sparks Market Turbulence

Ethereum's price fell to $1,880 as Vitalik Buterin's sales triggered $112M in liquidations. Institutional sentiment wavers with ETF outflows, while BlackRock prepares a staking product.

The cryptocurrency market is experiencing significant volatility, with Ethereum co-founder Vitalik Buterin's recent transactions contributing to the downward pressure. Over a tense 48-hour period, substantial sales from a founder's wallet correlated with a sharp price decline, pushing ETH to $1,880.01 and unsettling investors. While the stated purpose involves funding ecosystem development, the market's reaction has been decidedly nervous.

Market Reaction and Liquidation Cascade

The direct market impact was severe. Buterin's disposal of 1,869 ETH, valued at approximately $3.67 million, coincided with a price drop of nearly 6 percent. This selling activity is part of a larger trend observed since early February, totaling over 8,800 ETH sold for about $18.45 million. Analysis from platforms such as Arkham Intelligence suggests the proceeds are earmarked for research and development initiatives. Nevertheless, the immediate consequence was painful for bullish traders: long positions worth more than $112 million were forcibly liquidated within a single day, driving the market's "Fear & Greed Index" deep into extreme fear territory.

Shifting Institutional Sentiment and Leadership Change

Institutional flows have added to the headwinds. U.S. spot Ethereum ETFs recorded net outflows of nearly $42 million last week, indicating a cautious stance among some major players. Behind the scenes, however, strategic repositioning is underway. Asset management giant BlackRock is preparing its "iShares Staked Ethereum Trust," a product designed to provide investors with exposure to staking rewards. The firm intends to stake up to 95 percent of the fund's holdings through Coinbase. Concurrently, a surprise leadership shift occurred at the Ethereum Foundation, where co-executive director Tomasz Sta?czak resigned after less than a year, making way for interim lead Bastian Aue.

Conflicting Supply Dynamics and Technical Outlook

Fundamental supply indicators are presenting mixed signals. On one hand, a scarcity dynamic is supported by the fact that over 30 percent of the total ETH supply is locked in staking contracts. On the other hand, a notable increase in deposits on major exchanges like Binance has recently been observed—a pattern that often precedes selling activity. Market participants are now closely watching the key technical support level around $1,850. A failure to hold this zone in the current climate could invite further selling pressure, despite ongoing long-term technological advancements such as the new ERC-8004 standard for AI integration.