Ethereum Risks Falling Below $1.5K as Vitalik Buterin Sells ETH Faster

Ethereum is forming a bearish pennant pattern on the daily chart, suggesting a potential decline to $1,500 before any possible recovery to $2,500. This development aligns with weak demand in the futures market, ETF outflows, and negative technical indicators according to market analysis.

The token remains below key moving averages and the 78.6% Fibonacci Retracement level, confirming a bearish trend. Open interest in Ethereum futures has fallen sharply, from $70 billion to $23 billion, highlighting diminished demand.

Ethereum ETFs have seen outflows of $2 billion over four months, deepening the bearish outlook despite some positive developments like increased staking activity as reported.

What Drives the Bearish Outlook for Ethereum?

Ethereum's price has fallen nearly 60% from its October 2025 peak and is currently trading near $1,975. Bearish factors include ETF outflows, institutional selling, and uncertainty around Layer 2 value accrual according to analysis.

Prediction markets such as Kalshi show a 49–50% probability of ETH dropping to $1,250 by 2026, with nearly 30% chances of falling below $1,000. These probabilities reflect market sentiment, not guaranteed outcomes.

On-chain metrics like daily transaction volume and Total Value Locked (TVL) have declined, with TVL dropping over 22% in two weeks. Data shows DEX trading volume has also seen a notable reduction, adding downward pressure.

What Role Do Vitalik Buterin's Sales Play in the Downtrend?

Vitalik Buterin has sold over 7,380 ETH in under a month, including a recent withdrawal of 3,500 ETH from Aave and the rapid sale of 571 tokens within hours. These sales have added to Ethereum's bearish momentum.

Buterin's Ethereum Foundation had previously committed to a long-term strategic deployment of assets, but the swift liquidation of his reserves contradicts this approach. The timing of these sales coincides with a 30% price drop in the past month.

In February 2026 alone, Buterin sold 8,800 ETH, valued at $16 million, with a two-day period involving 1,869 ETH worth $3.67 million. These sales align with a broader price decline and continued market weakness.

What Technical and Market Indicators Suggest for Ethereum's Path Forward?

Ethereum's price remains in a broader downtrend on higher time frame (HTF) charts, following a distribution phase since the $5,000 peak. A parabolic curve formed from that high continues to act as a bearish pattern.

Structural support is found at $1,513–$1,537. A bounce from this level would not necessarily confirm strength; sustained momentum is needed to alter the bearish trajectory.

Liquidity imbalances suggest upside risk, with clusters forming above $5,000. If Ethereum experiences a sharp upward impulse, it could trigger forced liquidations. The market is currently in a decisive confrontation phase, with $1,513 as the key threshold.

What Are the Implications for Investors and the Market?

Ethereum's 30-day MVRV ratio suggests it is severely undervalued, with a 14.3% deficit compared to Bitcoin's 6.9% and other major cryptocurrencies. This indicates potential for a revaluation if the market improves.

Despite the drop, trading volume for ETH has increased 33% to $15.24 billion, showing heightened activity. Traders remain optimistic about Ethereum's long-term potential.

The market remains cautious, with fear dominating positioning. If Ethereum breaks below $1,513, it could validate bearish prediction markets. A continued defense might lead to unwinds in short positions, adding uncertainty for traders.