Buying ETH After the Retreat on Ethereum Foundation Selloff
Cryptocurrencies have displayed bullish momentum since January this year, with BTC pushing above $30,000 and Ethereum above $2,000 in April as the banking turmoil send investors toward cryptos. Although the buying pressure has slowed in recent weeks and we have seen a retreat in Ethereum in the last several days.
Yesterday, the major news in the crypto world revolved around the ongoing congestion issues experienced by Bitcoin and Ethereum blockchains. In response to the situation, Binance, one of the leading cryptocurrency exchanges, made an announcement that it had temporarily halted Bitcoin withdrawals.
As a consequence of the congestion, the network fees associated with Bitcoin transactions skyrocketed. On-chain data indicated that the total fees in Bitcoin surged to 6.13 BTC. The exact reason behind this sudden increase in fees remains unclear at this time. However, additional data from Binance revealed that the largest Bitcoin withdrawal ever recorded had taken place over the weekend.
It’s worth noting that cryptocurrency networks can experience congestion due to high demand and increased transaction activity. This can lead to delays in processing transactions and higher fees as users compete to have their transactions included in the limited block space available. Such congestion issues are not uncommon in the cryptocurrency space and are typically addressed through network upgrades and optimizations.
Another noteworthy development in the Ethereum ecosystem involves an Ethereum wallet associated with the Ethereum Foundation transferring 15,000 ETH tokens to a deposit address on the Kraken exchange. That was followed by another transaction where Vitalik Buterin, the co-founder of Ethereum, moved an additional 200 ETH tokens to the same exchange. The value of the first transaction amounts to approximately $30 million USD, sparking speculation and curiosity about the intentions behind the Ethereum Foundation’s actions.
On another such occasion back in November 2021, the Ethereum Foundation sold a substantial amount of 20,000 ETH, equivalent to around $9.5 billion at the time. This significant sale was followed by a decent price correction lower as it adjusted to the increased supply of ETH entering circulation. But, the correction looks almost complete as the 50 SMA (yellow) holds as support while the stochastic indicator is oversold already. So, we decided to open a buy ETH signal a while ago.
While the specific reasons behind the recent movement of funds from the Ethereum Foundation’s wallet and Vitalik Buterin’s personal address remain unclear, such transactions can be subject to various factors and motivations. Market observers and enthusiasts will undoubtedly be interested in monitoring any potential updates or announcements that shed light on the foundation’s intentions and how these transactions may impact the Ethereum ecosystem.
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