3 Reasons Why Ethereum Is Struggling Today: Will ETH Break $2,000?
08 August 2024 - 1:00PM
NEWSBTC
Even after the welcomed recovery on August 6, Ethereum is under
immense selling pressure today, August 7. Despite gains earlier
today, losses saw the coin edge lower, as visible in the daily
chart. The daily chart rejected the coin at around the $3,500
resistance level. At this pace, Ethereum could continue plummeting
if bears step on, mirroring losses of the first half of the week.
Jump Trading Liquidating Ethereum: Will Prices Drop Below $2,000?
Multiple factors at play explain the recent weakness. As it is, the
coin could drop even lower, targeting the $2,000 support line. With
the general crypto community cautious, Jump Trading, a crypto
market marketing firm, has been dumping ETH incessantly over the
past few trading days. Related Reading: Bitcoin Bull Run Still
Intact? Here’s What On-Chain Data Says According to Lookonchain
data, Jump Trading claimed 11,501 ETH worth over $29 million from
the liquidity staking platform Lido Finance. The blockchain
analytics platform said the block of ETH is set for sale. Jump
Trading, currently being investigated by the United States
Commodity Futures Trading Commission (CFTC), also plans to redeem
another 19,049 ETH worth over $48 million from the same platform.
This amount will likely be dumped in the secondary markets,
weighing down prices even more. On August 5, Jump Trading
liquidated over 120,000 wETH, accelerating the sell-off. Though
Bitcoin lost over 20% that day, losses were more pronounced on
Ethereum, which dumped by nearly 40% from July highs, dropping to
as low as $2,100. PlusToken Ponzi Scheme Tokens Moving, Impact Of
The Ronin Bridge Hack Beyond the liquidity impact of Jump Trading,
large amounts of ETH are being moved from wallets associated with
the PlusToken Ponzi scheme, according to Scopescan data. The last
time these wallets were moved was in 2021, when Chinese authorities
shut down the scam. The PlusToken Ponzi wallets control roughly $2
billion worth of ETH. Similar to the panic when the United States
government moved $2 billion of BTC and when Mt. Gox began
distributing BTC, the same is being witnessed. Presently, sentiment
has been dented and could depress ETH prices in the short to medium
term. Related Reading: Explosive XRP Prediction: Analyst Foresees
20-Fold Gain Though minimal, ETH faces more pressure following the
Ronin Bridge security breach. While the white hacker has returned
roughly 2 million USDC of the reported $10 million lost, the fact
that ETH was the main asset stolen is a concern. This is not the
first time the Ronin Bridge has lost money. In 2022, it lost over
$600 million in a disastrous hack. Feature image from DALLE, chart
from TradingView
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