"Unstable even when rising"...Ethereum Foundation's ETH sales 'shake' the market

▲ Ethereum (ETH)

Ethereum (ETH) showed an upward trend of approximately 10% in April. However, as the Ethereum Foundation has sold or liquidated some of its holdings, market questions are growing.

According to crypto media outlet Cointelegraph on April 27 (local time), with the recent rise in Ethereum's price, asset movements by the Foundation have been detected, leading to a spreading debate among investors asking, 'Why are they selling now?'

The core issue is not 'selling' itself, but rather the 'financial operational strategy.' The Ethereum Foundation has consistently utilized ETH for development funds and ecosystem support. In fact, the Foundation has regularly sold ETH in the past to cover annual operating expenses of approximately $100 million, and recently, it has shifted its asset management strategy to combine it with staking rewards.

The recent movement at the center of the controversy is a large-scale unstaking. The Foundation unstaked over 17,000 ETH to secure liquidity, which is valued at approximately $40 million. However, this is interpreted as a measure that opens up the 'potential for sale,' rather than an immediate sale.

The market interprets this movement from two perspectives. First, it's for securing operational funds or portfolio rebalancing. Unstaking some assets to secure liquidity is a common financial management practice for non-profit foundations.

Second, it's a signal of short-term selling pressure. Unstaking is a preparatory step that could soon lead to assets being available for sale in the market, and thus it can act as a burden factor during a price surge.

Indeed, in the past, the Foundation has sold some ETH during upward trends to secure operational funds, and analysis suggests that this current movement is likely in the same context. However, large-scale movements to exchanges or actual sales have not yet been confirmed.

Ultimately, the essence of this issue is less about being a 'negative factor' and more about differences in market interpretation of the Foundation's fund management methods. While the liquidation of Foundation holdings simultaneously with a price increase could heighten short-term volatility, the market accepts this as a structural variable, given that it is an essential structure for network maintenance and development in the long term.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*