ethereum fell as low as $2,100 this week before recovering, adding an impressive 25% since the August 2024 lows. While there is confidence that prices will continue to expand, surpassing $2,800 and even the psychologically round $3,000 figure, other market-related events could hold back the bulls.
ethereum network unlocks over 143,000 eth
According to Token Unlocks x.com/Token_Unlocks/status/1821485043136766208″ target=”_blank” rel=”noopener nofollow”>dataHundreds of thousands of eth are queued up and set to be withdrawn today. On-chain data reveals that validators are preparing to withdraw 143,000 eth worth nearly $350 million. Another batch of 212,000 eth will be available for trading in the coming days, which could put further pressure on prices.
As of August 9, ethereum has a circulating supply of over 120 million, according to CoinMarketCap ethereum/” target=”_blank” rel=”noopener nofollow”>dataSince Dencun, the network has been inflationary, meaning there is no more burning of coins like before.
Validators must stake at least 32 eth and ensure that their nodes maintain high uptime, close to 100%. At the same time, according to the network's consensus rules, validators must not engage in illegal activities, such as approving invalid transactions.
Failure can lead to slashing, where a portion of their stake is taken as a penalty. However, because they must commit to maintaining the decentralized network, they receive a portion of the annual staking yield. At the same time, they have the opportunity to approve a block of transactions, receiving rewards as a result.
The eth that hits the market is expected to be a result of your staking activities. This unlocking is different from block rewards which are distributed approximately every 13 seconds.
While the market is expecting a sudden surge in supply, Token Unlocks analysts point out that these withdrawals will not necessarily mean liquidation. However, if they are sold, recovery will likely be slow.
Will the bulls take control and force prices above $3,000?
There is cause for concern. Historically, Token Unlocks analysts note that prices tend to cool off when the ethereum network unlocks such a large amount of tokens in a short period. Over the past three months, unlocks of between 150,000 and 220,000 eth coincided with price drops.
Looking at the daily chart, ethereum is recovering. Although the downtrend remains after the unexpected drop to $2,100 earlier this week, the rally has been decent.
The immediate liquidation line is around $2,600. If buyers continue to move forward, gains will be confirmed. of August 8, eth prices could rise and dive in The expected floodand retest $3,000.
Featured image from Canva, chart from TradingView
