In a dramatic turn of events, top market makers have offloaded significant volumes of Ether (ETH), contributing heavily to the ongoing cryptocurrency market downturn. Since August 3rd, these entities have liquidated a staggering 130,000 ETH, equivalent to approximately $290 million at current valuations, causing Ether’s price to nosedive from $3,000 to below $2,200.

Prominent among these market makers, Wintermute spearheaded the sell-off, liquidating over 47,000 ETH. Following closely, Jump Trading disposed of 36,000 ETH, and Flow Traders contributed with the sale of 3,620 ETH. Additionally, GSR Markets and Amber Group sold 292 ETH and 65 ETH, respectively, as detailed in a research note by 0xScope shared with Cointelegraph.

Interestingly, Jump Trading initiated the sell-off, but Wintermute’s actions were far more extensive. 0xScope highlighted in an August 5th post on X: “Jump Trading started dumping ETH this past weekend, ahead of other major market makers, despite low liquidity.”

Ether currently battles to maintain its position above the psychologically significant $2,200 mark. Continuous selling pressure from market makers and major holders could exacerbate the decline, potentially triggering panic among investors.

Ether’s Struggle to Stay Afloat

As of 1:10 pm UTC, Ether’s price had plummeted over 22.3% in a 24-hour period, trading at $2,233, according to Cointelegraph data. The cryptocurrency briefly dipped to a daily low of $2,195 around 6:30 am UTC before clawing back above the $2,200 threshold. On a brighter note, pseudonymous crypto trader MarketWizard suggested in an August 5th X post that ETH could potentially double from its current lows if it replicates past performance: “Despite how scary things are [right now], ETH is at the sweet spot. Retesting the 2-year base that caused a x2 earlier this year.”

The Impact of U.S. Spot Ether ETFs

The precipitous decline in Ether’s price coincides with the debut of the first spot Ether exchange-traded funds (ETFs) in the United States on July 23rd. Despite this historic launch, inflows into Ether ETFs have remained subdued. Since their inception, U.S. Ether ETFs have recorded over $511 million in cumulative net outflows, according to Farside Investors data. Grayscale’s Ether ETF (ETHE) accounted for the lion’s share of outflows, exceeding $2.1 billion, while other ETF issuers have experienced net positive inflows.

While the introduction of Ether ETFs signifies a critical regulatory milestone, they appear to be playing second fiddle to Bitcoin ETFs in terms of investor interest. Eric Balchunas, senior ETF analyst at Bloomberg, told Cointelegraph: “Bitcoin is like enough crypto hot sauce. You’re like, ‘You know, I’m good.’ These things move together anyway. Ethereum is harder to explain, but I’m just seeing it being a sidekick [to Bitcoin].”