Ethereum is receiving two major signals at once, and they are pointing in different directions.
On-chain trackers have reported an explosion of ETH sales linked to Vitalik Buterin, the network’s most recognizable figure.
At almost the same time, the Ethereum Foundation began investing some of its treasury, positioning the move as a long-term shift in how it funds itself and supports the chain.
In a stronger market, both of these developments could be considered common. In today’s thin, risk-free band, contrast is history. A title looks like a sale. The other looks like a commitment.
As a result, ETH investors must decide which message is more important: one that could help bring the digital asset back above $2,000, or one that could push it further towards $1,000.
Buterin’s pace of ETH sales has become a market story
The most useful way to frame Buterin activity is through cadence, not totals.
Wallets linked to Buterin have been associated with approximately 3,765 ETH sold over approximately 2.5 days and approximately 10,723 ETH sold since February 2.
In dollar terms, this business was valued at about $7.1 million during the recent boom and about $21.7 million month-to-date, at an average sale price near $2,027.
It is to this acceleration that traders are reacting. A few million dollars in sales does not, in itself, constitute a destabilizing event for ETH.
However, an acceleration in the pace of sales can be, because it increases the risk of a persistent surplus during a period when demand is already uncertain.
It also fits a familiar cryptographic model. Crypto investors monitor known wallets not only to estimate supply, but also to infer confidence.
This conclusion is often fragile, because portfolios can change for reasons independent of market opinions, but this nevertheless influences positioning. Under conditions of risk aversion, this influence can be outsized.
There’s also a large-scale reality check that keeps Buterin’s story on track.
The US ETH spot ETF has seen net outflows of nearly $3 billion over the past four months, according to data from SoSo Value.
These billions of outflows can result in a number equivalent to ETH that is several times greater than Buterin’s total recent sales.
When ETFs are net sellers, the ETF envelope can dominate price action in a way that portfolio observation cannot.
This does not remove the visible sales effect. He reframes it. In today’s market, Buterin’s stock is more likely a sentiment catalyst than a supply shocker.
Foundation’s staking decision attempts to change funding perspective
The Ethereum Foundation’s staking rollout is a countersignal to one of Ethereum’s most enduring internal controversies.
On February 24, the Foundation declared:
“The Ethereum Foundation has started to stake a portion of its treasury, in accordance with its treasury policy announced last year. Today, the EF has made a deposit of ETH in 2016. Approximately 70,000 ETH will be staked and the rewards will be returned to the EF treasury.”
For years, a common criticism has been simple: “EF sells ETH to fund its operations.” This framework transforms treasury activity into a referendum on management.
It also urges traders to treat every cash movement as a market event, even when the amounts are small relative to liquidity.
Staking shifts the frame to “EF earns native yield from the protocol to fund operations.” This is closer to an endowment model than a periodic liquidation model.
This does not eliminate sales, as many costs are denominated in fiat currency. This can reduce the need for hard selling at the margin and provide a more systematic approach to cash flow management.
The short-term calculations are modest. Based on a staking base of around 37 million ETH (around 30% of the supply), 70,000 ETH is not enough to significantly change the staking market.
But symbolically, it’s a notable pivot.
With a networking yield of around 2.8% to 3.0%, 70,000 ETH could generate around 2,000 ETH per year (in ETH terms) under normal conditions.
This return does not replace a budget, but it is a recurring flow which can make funding less punctual.
The Foundation also positioned this effort as a demonstration of best practices, with a focus on distributed signers, a multi-client approach, and client resilience and diversity.
It’s partly technical and partly reputational. This is an issue, and it also reflects the FE’s desire to be considered a steward.
Ethereum’s Deeper Voltage, Usage Still Matters, Monetization Seems Smoother
Buterin’s sell-off story is more difficult because Ethereum is in a strange fundamental position.
Ethereum continues to dominate major settlement rails, particularly stablecoins and tokenized assets. This remains critical to how value moves in crypto markets.
Yet L1 generates less direct fee revenue, meaning the most visible monetization channel, fee consumption, is less favorable.
Ultra low gas is good for users. However, she is less supportive of the idea of “burning as value capture” because base fee consumption decreases with fees.
When consumption is low, ETH supply becomes more like a conventional issuance asset, and the focus shifts to alternative support bundles, ETF flows, macro risk appetite, and staking yield.
Staking itself remains an important part of the picture. Validator dashboards show a long input queue, measured in millions of ETH and weeks of waiting time.
This indicates continued interest in ETH as a yield-generating asset, even as price sentiment wavers.
There is a paradox here. Higher staking stake can tighten the liquid float. A smaller float can amplify volatility in times of stress because a smaller share of supply is flowing freely.
In a market dominated by fear, narratives can be self-reinforcing. A negative stock can prompt selling, selling can pressure the price, and price action can make the stock appear more valuable than it initially was.
Three scenarios that traders implicitly evaluate
The simplest way to frame what follows is to use scenarios combining flow, costs and optics.
- Scenario 1: the flow regime stabilizes (basic scenario)
If ETF outflows slow and macroeconomic conditions become more favorable, the market’s sensitivity to news from individual sellers tends to fade. In this environment, the change in FE ownership is useful by signaling long-term cash discipline. Price may re-anchor itself around broader themes of ETH, scaling, layer 2 growth, and institutional access via ETFs.
- Scenario 2: risk aversion persists (bearish case)
If macroeconomic uncertainty and fund outflows persist, weak liquidity amplifies the news. In this tape, the market is less concerned with whether Buterin’s sales are “important” than with whether those sales become a convenient indicator of broader doubt. Low fee requirements keep burn low, giving bears a simple narrative hook, smoother monetization, and poor optics.
- Scenario 3: monetization returns (bullish case)
If fee pressure rebounds, whether due to increased L1 usage, changes in value capture, or new demand drivers, the ETH supply story improves. In this environment, staking yield is part of a stronger total yield scenario.
Notably, 21Shares has outlined long-term ETH ranges from $1,000 in bearish conditions to around $4,000 in bullish conditions, with flows and monetization doing much of the work in the spread.
None of these scenarios are determined by a single person’s sale. But in an already nervous market, the person attached to the wallet can still count.
