Ethereum co-founder Jeffrey Wilcke sells another 20K ETH amid community discontent

The latest whale selling for Ethereum (ETH) originated from the wallets of Jeffrey Wilcke, one of the project’s co-founders. Another 20K ETH acquired at a low price range was sent to Kraken. 

Jeffrey Wilcke, one of the co-founders of Ethereum (ETH) sent 20K ETH to Kraken. The recent transfer follows a pattern where Wilcke continues to liquidate his initial share of ETH since the 2021 bull market. 

Wilcke started with a founder’s allocation of 463,203 ETH after the network’s launch in 2016. Since then, he has deposited a total of 356,805 ETH to exchanges. Before the 2021 bull market, Wilcke transferred a total of 290,505 ETH to exchanges at an average deposit price of $190.

After a pause, Wilcke resumed selling in the summer of 2023, liquidating more than 63K ETH. The wallet retains another 106K ETH, which can be sold at a much higher average price. The deposits to exchanges do not guarantee selling, and may be a preparation for a bigger ETH rally. However, the selling pressure may slow down as this early wallet has divested a large percentage of its holdings.

Following the new inflow of ETH, the token’s price did not stall its rally above $3,500. However, the selling raised the issue of early ETH founders failing to hold the token at key moments. Wilcke’s move is similar to selling from the Ethereum Foundation, usually taken as an indicator of a local market peak, followed by a price drawdown.

The worries about ETH hinge on its still-delayed major rally, as the asset is still under $4,000 while BTC broke into a new price range. The readiness of early Ethereum investors to sell is often criticized by the community. Vitalik Buterin has also continued to sell hundreds of ETH, though mostly for donations and investments. 

ETH rally stalls after news of Wilcke’s deposit

In the short term, the inflow of $70M worth of ETH is small compared to tokens available on exchanges. Markets held more than $70B in ETH liquidity, with inflows in the past week. It was Wilcke’s unwillingness to behave as a crypto insider that contributed to a less decisive rally for ETH. 

After breaking the $3,400 mark, ETH expanded to $3,549.30. The next potential stop for ETH is $4,000, after breaking the $3,700 resistance level. ETH aims to close the week above that level, in order to continue its growth. 

ETH’s open interest is still close to its three-year peak at $16.1B. The token has a 72% long position dominance, suggesting leveraged positions may be attacked with a short-term correction. 

Can whales sway ETH? 

For some, ETH selling from whales is only seen as a tool to create uncertainty. ETH is much more liquid, and short-term selling is easily absorbed. 

The supply of ETH is also widely distributed, with no entity strong enough to sway the market. More than 34.2M ETH is locked in staking. Whales hold 65.1M ETH in total, which includes exchange wallets, vaults and other reserves. 

The first class of investors hold 14.5M ETH, while retail also owns around 65M ETH. The total supply of 120M means some of the whales and retail overlap with staking. ETH remains a valuable token, where early investors do not sell, but support other projects, or stake for passive income. 

Additionally, Ethereum ETF saw another day of over $90M in new inflows. The Bitcoin ETF drew in $103M, with ETH catching up quickly. Ethereum ETFs have drawn more than $10B in assets under management and have become the biggest cluster of ETH long-term holders.

In the long term, ETH still has a bullish outlook, which allows its ecosystem to grow and expand. The movement of whales into Ethena (ENA) is also a sign that ETH is seen as reliable and capable of expansion. 

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