Following affirmative comments of an impending rate cut by U.S. Federal Reserve Chairman Jerome Powell, Ethereum (ETH) alongside other crypto assets experienced a rapid price gain, with the total crypto market cap rising by 6% on Friday. The price of Ethereum, in particular, moved upward by 6.38% to nearly breach the $2800 price mark. However, amidst this crypto market surge, the Ethereum Foundation (EF), a non-profit organization committed to supporting the Ethereum network, has offloaded a substantial amount of ETH.
According to on-chain analytics firm Spot on Chain, the EF, which is dedicated to financing critical developments on the Ethereum network, has been selling small amounts of its holdings over the past few months. This culminated in the sale of 2,516 ETH for $7.4 million DAI.
On Friday, the Ethereum Foundation executed its largest sale transaction of 2024, depositing 35,000 ETH worth $93.8 million on the Kraken exchange. Transactions of this magnitude generally attract significant attention as they often indicate potential market movements.
This latest transaction by the Ethereum Foundation has sparked considerable speculation due to the organization’s direct affiliation with the Ethereum network. Some ETH enthusiasts see such a sale as a bearish signal. As a result, ETH experienced a slight decline of 1.3% in the hours following the sale.
Despite this, overall market sentiment remains largely bullish, buoyed by the anticipation of a Federal Reserve rate cut in September. Rate cuts, the opposite of rate hikes, result in lower interest rates, enabling investors to acquire more volatile assets such as cryptocurrencies. Following Powell’s announcement on Friday, experts predict a rate cut of 30-50 basis points, which could have relatively positive effects on the crypto market, including ETH.
Moreover, the recent price surge may help mitigate the impact of the imminent expiry of 140,000 ETH options. The current price of ETH at $2750 is significantly above the max pain point of these options at $2625, meaning maximum financial losses would occur if the options expired at the current market price. Despite the substantial recent transaction, the Ethereum Foundation still retains a large horde of 273,273.96 ETH valued at $754.76 million. This indicates continued confidence in Ethereum.
Ethereum is currently trading at $2750 following the boost on Friday. Long-term traders will be keenly watching for a sustained price rally, as the altcoin still lags by 20.48% on its monthly chart.
