Ethereum Whales Dump Millions as Network Weakens — Is a Massive Price Crash Coming?

• Ethereum is facing heavy whale sell-offs and a decline in stablecoin supply.
• Several technical indicators suggest bearish pressure, and analysts have identified $1,546 as the key support level.
• Ethereum’s price is supposedly inflated, and some believe its value can only be maintained if it is used for stablecoins and real-world assets.

Ethereum (ETH) is under considerable pressure following the latest bullish whale activities that have escalated sell-offs in the market. Recent wallet data from LookOnChain reveals that a newly formed wallet recently withdrew 3,000 ETH, worth $4.92 million, from Kraken and deposited the same back to Aave and Compound protocols before borrowing 3 million USDC to be transferred back to Kraken, perhaps to use to fund more ETH purchases.

Similarly, today, another popular crypto investment company, Galaxy Digital, led by Michael Novogratz, proceeded to transfer 12,500 ETH for $20,361,725 to Binance. Within these three days, Galaxy has transferred more than 25,000 ETH, or the equivalent of more than $40 million, to the exchanges.

Other whale transactions include a deposit of 8,922 ETH, equivalent to about $14.82 million from Kraken, and a sell-off of 8,001 ETH for $13.06 million per ETH of $1632.

At the moment of this writing, Ethereum is around $1,634.54, and it has been down by 1.62% in the last 24 hours. The overall sentiment towards the market seems to be more cautious, with ETH down by almost 50% compared to the same period last year.

Declining Network Metrics Raise Investor Concerns

Apart from the price, the fundamental aspects of Ethereum are exhibiting signs of weakness in its network. In the past week, the stablecoin supply fell to $6.45 billion on Ethereum and rose to $2.727 billion on Tron, and the volume of USDT and USDC turnover was $1.52 billion.

Moreover, the TVL in Ethereum for decentralized finance has declined from $66.5 billion at the beginning of 2025 to $46.5 billion. This implies that user engagement and overall capital invested in the network are steadily going down.

Technical indicators reinforce bearish sentiment. On the daily chart, the Relative Strength Index is at 41.71, indicating a moderate downward move or possibility of sideways movement. The MACD is also showing a bearish trend as it stands at -114.1 while the signal line is -123.6.

Prominent on-chain analyst Ali Martinez has also noted the $1,546 as a significant support level. More than 820,000 ETH were bought at this price level, which means that bulls should defend it well to see a bounce.

Analysts Debate Ethereum’s Long-Term Value Proposition

The value proposition of Ethereum is also questionable. Garrison Yang, the co-founder of Web3 development studio Mirai Labs, believes Ethereum is overvalued. He argues that Ethereum Layer-1 revenues are declining even though Layer-2 primitives such as Base and Arbitrum rely on the Ethereum network.

Base reported $82.7 million in revenue in the last year while paying $5 million to Ethereum’s Layer-1. In comparison, Arbitrum previously generated $95 million of revenue from $152 million of revenue prior to the Dencun upgrade, which saw a massive decline in Layer-1 rent collection.

However, Yang remains cautious about the performance of Ethereum‘s Exchange-Traded Product (ETF) compared to Bitcoin’s ETF. According to him, the adoption of stablecoins, as well as real-world assets (RWAs) on the Ethereum chain, would define its future importance.