Ethereum News Today: Ethereum Rallies on Whale Buying, Outpaces Bitcoin Amid Supply Concerns

Ethereum price action has drawn attention from analysts and investors as ETH climbed back toward $3,000 after a week of volatile swings. On-chain data shows whales are increasingly favoring Ethereum over Bitcoin, with significant buying activity and futures trading suggesting optimism in ETH's potential.

This shift comes amid growing concerns over ETH's supply dynamics and broader market sentiment tied to macroeconomic factors.

Whale accumulation has accelerated in recent weeks, with large investors trading over $3.3 billion in ETH futures and making sizeable spot market purchases on major exchanges. This buying pressure has contributed to ETH's 16% rebound from November lows, outpacing Bitcoin's 9% gain in the same period. Some analysts see these moves as a sign of long-term positioning rather than short-term speculation.

Exchange outflows have also surged, with over 248,711 ETH withdrawn in a single week. These withdrawals, valued at more than $766 million, indicate investors are moving tokens to personal wallets, signaling a shift toward accumulation. The shrinking ETH reserves on exchanges have fueled market speculation that a supply squeeze could develop if the trend continues.

Why the Standoff Happened

The growing preference for Ethereum among whales has coincided with a decline in Bitcoin's dominance, now below 60% for the first time in years. On-chain data reveals a sharp increase in ETH purchases by large investors on platforms like Coinbase and OKX. These transactions have been accompanied by a surge in ETH futures trading, further reinforcing the bearish stance toward Bitcoin.

Whale activity is often seen as a leading indicator of broader market sentiment. The fact that whales are favoring Ethereum over Bitcoin suggests they see stronger fundamentals and growth potential in the Ethereum ecosystem. This trend has been amplified by Ethereum's dominance in the stablecoin market, where it holds over $171.8 billion in value, far ahead of its nearest competitors.

Ethereum's technical performance has also played a role in attracting whale attention. After a sharp price correction in recent weeks, ETH has shown signs of support around the $2,800 level. While the token has yet to reclaim key resistance levels above $3,500, the fact that large investors are accumulating during weakness suggests they see value at current prices.

Risks to the Outlook

Not all signals are bullish, however. Recent data shows a wave of Ethereum whales selling large blocks of ETH, creating downward pressure on the price. These sales, which include one whale transferring $14.5 million in ETH to Kraken and another depositing $51.4 million worth of ETH on Binance, have raised concerns about profit-taking and long-term market confidence.

The divergence between whale and retail investor behavior has added complexity to the market. While large holders are selling, retail investors continue to buy, driven by FOMO and optimism about Ethereum's future. However, analysts warn that retail buying may not be sufficient to offset the selling pressure from whales, particularly as institutional flows also appear to be cooling.

Ethereum spot ETFs have experienced five consecutive days of net outflows, reducing total assets from $21 billion to $17 billion. This retreat by institutional investors signals a broader re-evaluation of crypto exposure, especially as macroeconomic risks, including the upcoming Bank of Japan rate decision, remain a key factor.

What This Means for Investors

For now, the market remains in a state of flux, with conflicting signals from large and small investors. Ethereum's price is currently consolidating near $3,150, below key moving averages, and bulls will need to push above $3,300 to regain momentum. Failure to do so could open the door for a deeper correction, with some analysts warning that ETH could fall toward $2,500 if macro conditions worsen.

The return of a major Ethereum whale who previously held over $1.5 billion in ETH has added another layer of uncertainty. This whale recently borrowed $85 million in USDT and withdrew $119 million in ETH from Binance, raising questions about the long-term positioning of large investors. While such activity is often seen as a sign of confidence, it is not a guarantee of future price direction.

Investors are closely watching on-chain metrics such as exchange inflows, whale wallet movements, and stablecoin activity for early signals. Ethereum's ability to maintain support above $2,800 will be critical in determining whether it can recover its long-term bullish trend or enter a deeper correction phase.