Ethereum (ETH) is once again under the spotlight, and not for bullish reasons. A fresh whale movements and liquidation trends have stirred fears across the crypto market that a deeper correction could be looming for the world’s second-largest cryptocurrency.
Recent data reveals a significant reduction in Ethereum whale holdings, with nearly 760,000 ETH offloaded in the past two weeks, adding downward pressure on Ethereum’s price. However, while the short-term charts look shaky, Ethereum’s growing strength in decentralized finance (DeFi) continues to offer investors long-term hope.
Whale Exodus Shakes Ethereum Sentiment
According to on-chain analytics from CryptoRank and Coinpedia, whale wallets dumped 760,000 ETH between mid-May and late May 2025. This aggressive move slashed large transaction volumes from $12.24 billion to $3.28 billion, a 73% collapse in just three days.
Whales typically serve as key indicators of market sentiment. When large holders begin to offload at scale, it’s often interpreted as a sign of bearish expectations or profit-taking at local highs.
As a result, the market has started pricing in the likelihood of a correction, especially as Ethereum faces resistance around key Fibonacci levels.
Ethereum Price Snapshot
Metric Value Current Price (ETH/USD) $2,580.02 24-Hour Change +0.00039% 24-Hour Liquidations $40.66 million Short Liquidations $15.12 million Long Liquidations $25.54 million
Data source: CoinMarketCap, CoinGlass
Over $40 million in liquidations were recorded in just 24 hours, with longs absorbing the majority of the pain. This indicates that many traders were caught off guard, expecting continued bullish momentum after Ethereum previously tested levels above $2,700.
DeFi Ecosystem Remains a Bright Spot
Despite short-term volatility, Ethereum’s DeFi foundations remain solid. The Total Value Locked (TVL) in Ethereum-based DeFi platforms has surged from $50.63 billion on April 26 to $62.7 billion by May 26, marking a 25% increase in just one month.
Ethereum continues to dominate the DeFi space with 54% market share, far outpacing Solana (8%) and BNB Chain (5%).
This growing adoption and utility may not immediately reflect in price but adds strong underlying value to the ETH ecosystem. For long-term investors, this trend highlights Ethereum’s staying power as the backbone of smart contracts and decentralized finance.
Profitable Whale Trades Suggest Tactical Moves
Interestingly, not all whales are fleeing the market. A single Ethereum whale executed a $32.4 million swing trade in one well-documented move.
May 22: Sold 30,000 ETH via Wintermute OTC
May 26: Re-bought the same 30,000 ETH at a lower price
This calculated maneuver netted the whale tens of millions in profit and reflects a growing trend of professional players capitalizing on market volatility. While panic sell-offs dominate retail reactions, institutional whales are playing chess, not checkers.
Technical Outlook: Deeper Correction or Support Bounce?
Ethereum is currently testing support near $2,550, which coincides with the lower bound of its ascending channel on the daily chart. A breakdown below this zone could lead ETH toward the $2,300–$2,350 area, where it has previously found demand.
However, if bulls defend this level and whale accumulation resumes, Ethereum could mount a rebound toward the $2,700 resistance zone again. Much will depend on overall market sentiment, Bitcoin’s price trajectory, and macroeconomic catalysts like interest rate news or ETF inflows.
“Ethereum’s DeFi dominance is unshaken, but short-term price action looks fragile. Whales are reshaping the battlefield,” said crypto strategist Lara Kim from X10 Trading.
What Should Investors Watch Now?
As Ethereum teeters between support and correction, here are the key indicators to watch:
Whale Wallet Flows: Continued outflows suggest caution.
DeFi TVL Growth: If Ethereum keeps gaining dominance, long-term potential remains strong.
Liquidation Trends: A spike in long liquidations could trigger further drops.
BTC Correlation: Ethereum remains closely tied to Bitcoin’s performance. Watch for BTC trend reversals.
Conclusion
Ethereum’s latest price dip is driven by whale exits, shrinking transaction volumes, and rising liquidation levels, signaling a short-term cautionary phase. However, the ecosystem’s strength in DeFi and strategic whale trading activity hints at a broader resilience.
For investors, the message is clear: while short-term turbulence may continue, Ethereum’s long-term fundamentals remain intact. Navigating this phase will require focus, patience, and a sharp eye on whale behavior.
FAQs
Why is the Ethereum price dropping?
Large whales sold 760,000 ETH in two weeks, creating heavy sell pressure and triggering liquidations.
What is Ethereum’s current price?
As of May 27, 2025, Ethereum is trading at around $2,580.02.
Is Ethereum’s DeFi sector still strong?
Yes, Ethereum’s DeFi TVL grew by 25% in May and holds 54% of the total DeFi market.
Can Ethereum recover soon?
It depends on whale re-entry, Bitcoin’s trend, and key support levels holding near $2,550.
Glossary of Key Terms
Whales: Investors holding large amounts of cryptocurrency.
DeFi (Decentralized Finance): Blockchain-based financial services without intermediaries.
Liquidation: Forced closure of a leveraged position when losses exceed collateral.
TVL (Total Value Locked): Total amount of crypto locked in DeFi protocols.
Sources and References
Binance
Coinpedia
Blockchain News
Read More: Ethereum’s DeFi Strength vs Whale Panic: Who Wins This Battle?">Ethereum’s DeFi Strength vs Whale Panic: Who Wins This Battle?
