After falling below $1,800 earlier in the month, Ethereum price has since regained the $2,000 level, which is considered a psychological support zone for many traders. However, over the past week, the price has shown slight downward pressure, struggling to sustainably hold above the $2,000 level.
Whale activity signals potential increase in volatility in Ethereum markets
In an article on Platform X, crypto analyst Joao Wedson said that there has been a major shift in the behavior of large Ethereum holders. The market expert also pointed out that something deeper could be happening beneath the surface.
🐳Whales continue to distribute and sell Ethereum.
Addresses holding between 100,000 and 1 million ETH have significantly reduced their reserves over the past 90 days. This is a significant and curious change.
What stands out even more is that much of this reduction is not… pic.twitter.com/UBlikDUQf3
– Joao Wedson (@joao_wedson) February 27, 2026
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Wedson claimed that wallet addresses holding between 100,000 and 1,000,000 ETH have significantly reduced their holdings over the past 90 days, showing that large holders are selling or moving large amounts of ETH. What is more interesting is that this reduction occurs in non-traded whale wallets.
🐳Whales continue to distribute and sell Ethereum.
Addresses holding between 100,000 and 1 million ETH have significantly reduced their reserves over the past 90 days. This is a significant and curious change.
What stands out even more is that much of this reduction is not… pic.twitter.com/UBlikDUQf3
– Joao Wedson (@joao_wedson) February 27, 2026
In other words, major private ETH holders, institutions, or early investors may actively reduce their exposure, which could indicate profit-taking, risk aversion, or preparation for volatility. Overall, Wedson noted that when this group of whales begins to change position, it often means a structural change is occurring beneath the surface.
At the time of writing, the price of Ethereum stands at around $2,010, up almost 5% in the last 24 hours.
Global Collapse Affects ETH Most
According to a recent on-chain observation, this strategic move by large ETH holders could be linked to deteriorating macroeconomic conditions. Pseudonymous analyst Darkfost, in a Quicktake article on the CryptoQuant platform, revealed that the global economic backdrop is slowly losing momentum and Ethereum appears to be the most affected altcoin so far.
Starting with the global climate of risk aversion, Darkfost referenced the Producer Price Index (PPI), which measures inflation at the wholesale level. The Core PPI MoM +0.8% confirmed the persistence of inflation, suggesting that the Federal Reserve is unlikely to cut interest rates in the near future, which is unfavorable for risk assets.
Additionally, growing tension between the United States and Iran increases geopolitical uncertainty. On Saturday, the United States and Israel announced military actions against Iran, causing cryptocurrency prices to plummet over the weekend.
However, Ethereum Open Interest (OI) across all exchanges decreased from 7.79 million ETH to 5.8 million ETH, of which around 2 million is concentrated on Binance. This reveals that traders are closing their positions and leverage is reduced, with exposure to ETH also decreasing.
Additionally, notional OI, which measures the total dollar value of open contracts, saw a steeper decline as positions were closed. For example, Binance’s open interest fell from over $12.6 billion to $4.1 billion, while Bybit’s was reduced by two-thirds to $1.9 billion. This shows widespread deleveraging across the entire market and not just on one platform.
Overall, the Ethereum derivatives market is contracting as traders reduce leverage in response to macroeconomic and geopolitical pressures. Additionally, current market conditions have not been particularly encouraging for investors’ risk appetite, as seen with ETH whales.
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Featured image from iStock, chart from TradingView
