Within the past 24 hours, the Ethereum Foundation conducted two transactions, where it traded some of its ETH holdings for DAI. This action follows previous criticism faced by the Foundation for similar large-scale ETH sales.
The move to convert ETH into stablecoins like DAI could be seen as a strategic measure to manage their assets effectively. However, concerns arise regarding how this might influence market sentiment and the stability of ETH’s price.
Recent Developments from Ethereum Foundation
Data gathered from Spot on Chain reveals that on 5 September, the Ethereum Foundation sold 100 ETH for more than 241,000 DAI. While this initial sale didn’t cause significant ripples, a subsequent transaction on 6 September garnered attention. During this transaction, the Foundation transferred 1,000 ETH, equivalent to around $2.38 million, to a multi-signature wallet, likely for a future swap for DAI.
Despite the raised eyebrows over these transactions, the Foundation still possesses a considerable amount of ETH, totaling over 274,000 ETH, valued at more than $652 million. While the recent sale of 1,000 ETH has sparked some concerns, a transaction 13 days ago, involving the movement of over 35,000 ETH to Kraken, also invited questions about the Foundation’s intentions behind these transactions.
Responses to accusations of asset liquidation from Ethereum’s Vitalik Buterin have been issued in the past, but neither he nor the Foundation has commented on these latest transactions.
Assessment of Ethereum’s Social Impact
An analysis of Ethereum’s social presence reveals a slight rise in its dominance, capturing over 8% of overall crypto conversations. However, a detailed inspection on Santiment indicates that the recent sale by the Ethereum Foundation has not yet become a trending discussion point. Despite these transactions, there has been no significant impact on the wider crypto community chatter.
The lack of widespread attention signifies that the market sentiment remains largely unaffected by the sale, indicating that, at least for now, Ethereum’s price is unlikely to be adversely affected. The current market response appears neutral, with no immediate anticipation of substantial price fluctuations due to the Foundation’s activities.
ETH’s Price Movement
At the end of trading on 5 September, ETH was valued at approximately $2,367, marking a decline of more than 3% on the charts. This downward trend persisted into subsequent sessions, with the altcoin trading at about $2,343 soon after.
Although ETH’s price may continue to dip, the recent sales by the Ethereum Foundation are not seen as driving forces behind this trend. The current price movements seem more aligned with broader market conditions since there hasn’t been a notable shift in sentiment triggered by the Foundation’s recent activities.
Furthermore, at the current moment, ETH remains entrenched in a bearish pattern, as indicated by its Relative Strength Index (RSI). Unless there are signs of a momentum shift or improvements in other technical indicators, ETH is expected to face challenges in the short term.