- Two major bankrupt crypto firms, Celsius and FTX, are dumping massive amounts of Ether (over $150 million in a week).
- Celsius has about $1.4 billion in ETH holdings left, meaning the liquidations are unlikely to stop soon.
- FTX/Alameda also offloaded crypto, including $8 million ETH, in an effort to recover $3.4 billion in crypto assets.
- Ethereum’s fundamental analysis points towards a crash due to the dumping, but technical analysis suggests a possible 40% rally towards $3,500.
- Ethereum’s fate depends on its price action around $2,460.
The crypto industry has been through several ups and downs over the last two years.
Things are better now than they were in 2022, but Celsius and FTX, two of the most affected companies in 2022’s events, appear to now be dumping huge amounts of ETH and other cryptos on the market.
Both of these companies are currently struggling to repay their creditors, and have now flooded CEXes like Coinbase and Binance with hundreds of millions worth of Ethereum.
Is a nasty crash coming for Ethereum? Is the cryptocurrency fundamentally strong enough to withstand any turbulence?
Let’s find out what the ruckus is all about.
Celsius Unstakes and Dumps ETH
Celsius used to be one of the biggest crypto lending platforms in its prime. However, things soon turned sour, leading the company to file for bankruptcy in July 2022, after losing more than $500 million in a series of hacks and frauds.
Most of Celsius’ funds remained staked or frozen by various authorities, all while the company kept getting sued left and right by investors and customers, for alleged “breaches of contract”.
As a way to keep itself from drowning under all of that debt, Cesius has begun unstaking and selling its ETH holdings on a massive scale.
According to a recent tweet from Arkham Intelligence, Celsius has transferred more than $125 worth of ETH to Coinbase and FalconX over the last week.
This is an obvious attempt to salvage the situation and repay its creditors, and unfortunately, more is set to come.
Arkham reports that this $125 million sale is only the tip of the iceberg because Celsius still has more than 550,000 ETH left, worth nearly $1.4 billion at current prices.
FTX and Alameda Research Join The Dumping Bandwagon
Celsius is not the only major company that has been dumping its crypto on the market.
Sam Bankman-Fried’s FTX/Alameda is also heavily invested in the crypto dump and has been transferring huge amounts of crypto to Binance and Coinbase, according to a recent tweet from Spot On Chain.
Spot On Chain reports that FTX made these transfers sometime on 14 January, sending about $18.7 million worth of Wrapped Bitcoin, $8 million of ETH and $1 million of Pendle to centralized exchanges like Binance and Coinbase.
So far, FTX and Alameda have managed to recover about $7 billion worth of assets, of which about $3.4 billion are in crypto.
Is Ethereum About To Crash Heavily?
The idea of value is that the price of an asset goes up, the more scarce it gets.
These companies have dumped more than $150 million worth of crypto on the market over the last week alone, of which most is in ETH.
This suggests a possible dump on Bitcoin’s sister cryptocurrency. However, Ethereum seems strong from a technical perspective, as far as the charts go.
According to a recent analysis piece from renowned analyst, Michaël van de Poppe, since Ethereum broke past the $2,130 zone, it only has to break past $2,700 to continue further upwards and hit $3,500 in the next 2-3 months.
According to the Ethereum chart, Ethereum appears bullish on its medium to long-term perspectives.
After a rejection from its previous high of around $2,717, Ethereum appears to have reversed for a retest of the $2,460 support and appears to have its strongest bulls around this zone.
The chart above shows that if Ethereum successfully keeps from breaking below $2,460, we might see the 40% rally that takes it straight up to $3,500 as van de Poppe predicts.
Is Ethereum about to crash heavily?
It depends on whether or not the $2,460 support breaks.
Disclaimer: Voice of Crypto aims to deliver accurate and up-to-date information, but it will not be responsible for any missing facts or inaccurate information. Cryptocurrencies are highly volatile financial assets, so research and make your own financial decisions.