"I just saw the on-chain data, BitMine bought 131,000 ETH in half a day. I quickly chased and bought 10 at 4580. Can I follow this wave?" "I missed the opportunity when MicroStrategy bought BTC, and now BitMine is sweeping ETH; if I miss this again, I will lose big!"
This morning, the fan group was filled with this kind of "excited yet conflicted" news—just as the market was still debating whether ETH could break 4680, the crypto giant BitMine suddenly threw out a "big bomb": within 12 hours, spending 591 million dollars to sweep 131,000 ETH from three top institutions—BitGo, Galaxy Digital, and FalconX. Combined with the purchases made earlier this week, it now holds 1.845 million ETH (worth 8.54 billion dollars), with an average cost of 3868 dollars, directly pushing "ETH whale actions" to trending topics.
Don’t just focus on the excitement of the "whale's bulk buying." Today, let’s dissect "why BitMine bought, what impact it has on ETH, and whether retail investors should follow" to help you understand if this is an "opportunity to get on board" or the "prelude to whales cutting retail investors."
First, look at the details of whale operations: it's not retail-style buying, it's institutional-level "precise bulk buying."
Many people think "BitMine just buys randomly," but after reviewing the on-chain data on lookonchain, I found this is a "well-planned large move," with every transaction hiding a strategy:
3 large transactions in 12 hours, precisely targeting top institutions.
BitMine's bulk purchase is not "scatter buying," but rather done in 3 transactions directly from three institutions, concentrated between 2 AM and 2 PM on August 28:
At 2:15 AM, 50,000 ETH (worth 22.7 million dollars) was withdrawn from BitGo, with transfer notes stating "inter-institutional over-the-counter trading," without going through public exchanges to avoid pushing market prices up;
At 10:30 AM, 46,000 ETH (worth 20.9 million dollars) was received from Galaxy Digital, and this transaction wasn’t even listed on the secondary market, completed directly through inter-institutional OTC;
At 1:45 PM, 35,000 ETH (worth 15.5 million dollars) was swept from FalconX, just as ETH's price had retraced to 4550, perfectly catching the short-term low.
This kind of "avoiding the secondary market and directly obtaining goods from institutions" operation is identical to MicroStrategy buying BTC in 2020— it neither triggers retail investors to chase high prices nor accumulates chips at a low price. The whales' "price control ability" is evident.
1.845 million ETH holding accounts for 1.5% of circulating supply, with costs 20% lower than retail investors.
What’s more painful is BitMine's holding cost: 3868 dollars, which is 15.5% lower than the current ETH price of 4580 dollars. This means that even if ETH drops to 4200, it can still profit by 8.5%.
Moreover, a holding of 1.845 million coins already accounts for 1.5% of ETH's circulating supply, equivalent to "for every 67 ETH in the market, 1 is in BitMine's hands"— this level of holding means that as long as BitMine does not sell, the circulating supply of ETH will be reduced, significantly decreasing short-term selling pressure.
This morning, an institutional friend told me: "BitMine's purchase of ETH this time is tied to the Ethereum 2.0 upgrade. They are optimistic about future staking returns, and with an 8.5 billion holding, they may later distribute the chips to retail investors through an ETF. Buying now is like 'buying low and waiting for an increase.'"
Second, the impact on the market: short-term benefits support ETH, but two risks must be cautious.
Many people ask, "If whales buy, does ETH definitely go up?"—In the short term, it does indeed provide a boost, but long-term risks cannot be ignored. These two points must be understood:
Short-term: reduced circulating supply + heightened sentiment, ETH may surge to 4800.
Reduced circulating supply: 131,000 ETH means "there's 591 million dollars less selling pressure in the market." After BitMine's purchase yesterday afternoon, ETH rose directly from 4550 to 4620, a short-term increase of 1.5%, simply because buying pressure increased and selling pressure decreased;
Sentiment-driven: whale purchases will make retail investors feel that "since institutions are optimistic, I can follow too." Yesterday afternoon, Binance's ETH buying surged by 30%. A fan said, "Seeing BitMine buy, I added more than 5 times my position." This sentiment can temporarily push prices higher.
Reference case: In 2020, MicroStrategy bought 15,000 BTC (worth 250 million dollars) for the first time. BTC rose from 11,000 to 13,000, an 18% increase. This time BitMine's purchase amount for ETH is 2.3 times that amount, and the short-term increase might be even larger.
Long-term: Whale holdings are a "double-edged sword"; selling off can crash the market.
Don't just look at short-term gains; remember "whales buy to make money, not for charity":
If 1.845 million ETH were to be sold, it could breach support levels: referring to a certain whale selling 100,000 ETH in 2021, where ETH dropped from 4800 to 4200, a 12.5% drop. BitMine's holdings are 18 times that amount, and if future selling occurs, the consequences would be more severe.
Cost advantage crushes retail investors: BitMine's cost is 3868, while retail investors are currently buying at 4600. If ETH retraces to 4200, retail investors will lose 8.7%, while BitMine will still profit 8.5%. Whales have enough space to "cut retail investors."
Inter-institutional "dark box operations": Previously, whales collaborated with institutions to "buy first and then call, retail investors follow suit and then sell." After BitMine's purchase this time, there are already "call bloggers" saying "ETH will break 5000." If retail investors blindly chase, they may become the ones left holding the bag.
In 2022, I fell into this trap: at that time, a certain whale bought 50,000 SOL (worth 100 million dollars), and I chased at 120, but the whale quietly sold at 130, and SOL dropped to 90, causing me a 25% loss—later I found out that the whale had already agreed with institutions for a "high-level selling share" when buying.
Third, what retail investors care about most: Can we follow the trend now? Suggestions for three situations.
Aggressive stance: Want to follow but don't go all in; set stop loss at 4500.
If you want to try, take a maximum of 20% position (for example, with 100,000 capital, use 20,000 to buy), set the stop loss at 4500 (yesterday's retracement low), target to look at 4750-4800 (previous resistance level), take profit at 50% when it rises, don’t be greedy for "breaking 5000;"
Yesterday, a fan bought 2 ETH at 4600, setting a stop loss at 4500. He said, "Even if I lose, it's only 200U, which I can accept; it's better than missing out."
Cautious stance: wait for two signals before buying, safer than following the trend.
Signal 1: ETH stabilizes at 4650, and the hourly trading volume maintains above 3 billion dollars (currently at 2.5 billion), indicating strong buying pressure, not "after the whale pulls the market up, no one is there to catch it;"
Signal 2: If BitMine does not have subsequent "transfers to exchanges" actions (if whales transfer ETH to Binance, they might want to sell), you can pay attention to its holding address on-chain (0x...f8A9), if the ETH in the address hasn't changed, then consider buying;
Previously, a fan waited for SOL to stabilize at 130 before buying; although it was 5 dollars higher than the lowest point, it avoided the pitfall of a "false breakout," and later made a profit of 10%.
Long-term view: Don't just focus on short-term gains, look at Ethereum 2.0 staking.
BitMine buying ETH is likely for "Ethereum 2.0 staking" (currently yielding 4%-6% annually), staking 1.845 million ETH could earn 370 million to 550 million dollars a year, this "earning through interest" model is more stable than short-term trading;
If retail investors want to hold long-term, they can stake ETH in Lido or Coinbase, earning interest while avoiding short-term volatility from "whale selling." In 2023, a fan staked 100 ETH and now has 106 ETH, including principal and interest, which is more than what short-term trading earned.
Lastly, let’s be honest: just because whales buy ETH doesn’t mean retail investors can profit.
In 2020, when MicroStrategy bought BTC, it indeed drove BTC from 11,000 to 69,000, but many retail investors chased high at 50,000, ending up trapped at 30,000. In 2021, a certain whale bought SOL, and retail investors followed at 250, resulting in a drop to 80, losing 68%.
The advantage of whales is "more capital, lower costs, and ability to control the market." The advantage of retail investors is "flexibility and ability to quickly cut losses"—don’t think about "making big money by following whales," think about "how to avoid being cut by whales."
For this time BitMine buys ETH, retail investors could:
Not chase high, wait for a pullback to 4450-4500 to buy (about 1.2 times the whale's cost, relatively safe);
Set a stop loss; even if the whale sells, you can exit in time, don’t hold onto the position;
Don’t go all in; take a maximum of 30% position, and keep the rest for bottom fishing or risk management.
I will be monitoring BitMine's on-chain dynamics in real-time in the fan group (such as whether holding addresses have made transfers, changes in sales orders on exchanges for ETH). If there are signals indicating "whales are preparing to sell," I will inform everyone immediately. If you want to avoid "being caught in the trend," just follow me—profit in the crypto circle comes from "understanding whale actions" and also from "controlling risks." Don’t let the whales' "bulk buying" cloud your judgment.
Let's discuss in the comments: do you think BitMine's purchase of ETH is a long-term bullish move, or short-term speculation? Do you currently hold ETH? Are you planning to increase your position or take profits? #ETH #以太坊巨鲸影响
