During the past week, Ethereum [ETH] found itself at the center of controversy. After the recent breach at Bybit, investors initially expressed concerns over the security of their holdings. Fortunately, the Ethereum supply on the platform has since stabilized, easing worries.
Nevertheless, another security breach has unfolded.
Hacker Acquires 17,696 ETH Valued at $49.5 million
In the recent hours, Ethereum faced a new security threat. An unknown entity created an account and used 49.5 million DAI to purchase 17,696 ETH tokens.
Initially, Lookonchain viewed this transaction as a large-scale accumulation of assets. Subsequently, it was identified as a security breach.
According to reports by Lookonchain, the Stablecoin bank Oxinfini fell victim to the attack, resulting in the theft of 49.5 million USDC. The hacker swiftly exchanged the USDC for an equivalent amount of DAI.
The hacker then utilized these stablecoins to acquire 17,696 ETH. Following the purchase, the tokens were transferred to the newly established account previously identified as a significant accumulation of assets.
Such breaches not only harm Oxinfini but also tarnish ETH’s reputation due to its recurring association with malicious actors.
This negative publicity may impact investors’ perception of Ethereum, potentially leading to a downturn in its price trajectory.
Implications for Ethereum
Predictably, this news has had an adverse effect on Ethereum’s market performance. At present, Ethereum is valued at $2705, reflecting a 3.49% decline on a daily basis.
Moreover, ETH has experienced declines across weekly and monthly charts, dropping by 2.89% and 18.8% respectively.
Despite the downward trend in price, Ethereum investors remain positive and continue to engage in ETH purchases.
This optimism is underscored by the notable increase in the Buyer Taker Sell ratio, rising from 0.9 to 1.085. A ratio exceeding 1 indicates a surge in buying compared to selling activity.
Consequently, Ethereum is currently facing heightened buying pressure.
Furthermore, U.S. investors, particularly institutional entities, are actively accumulating ETH.
This accumulation trend is evident through a positive Coinbase premium index, which rebounded in the past day after dipping into negative territory.
A positive Coinbase premium index signals robust buying interest from U.S. investors.
Lastly, sustained buying behavior has led to increased scarcity of Ethereum in the market, causing ETH’s stock-to-flow ratio to climb to 99.13 over the previous week.
An ascent in the stock-to-flow ratio indicates a reduction in ETH supply relative to demand. Heightened scarcity tends to drive prices upwards under stable or growing demand conditions.
In conclusion, despite recent security breaches affecting Ethereum’s image, investor sentiment remains resilient. With buyers striving to regain control amidst active selling, ETH faces a pivotal moment.
Consequently, prevailing market conditions suggest that Ethereum will likely continue to trade within the range of $2.5k to $2.8k.