Ethereum Faces Mounting Pressure Amid Market Shakeups and Investor Moves

Speculation Over Ethereum Foundation's Involvement in $56 Million Deposit Unraveled

A significant Ethereum transaction sent shockwaves through the crypto market after a wallet transferred 30,098 ETH—valued at approximately $56 million—to Sky, formerly known as MakerDAO, on March 10, 2024. Initial findings from on-chain reporters like Lookonchain, Arkham Intelligence and Wu Blockchain suggested the Ethereum Foundation was behind the deposit, fueling widespread speculation. 

However, prominent Ethereum figures Eric Conner and Anthony Sassano swiftly dismissed the claim as baseless. Wu Blockchain later corrected its reporting, revealing that the wallet actually belonged to an early Ethereum investor, “jonny.eth,” rather than the Ethereum Foundation.

The deposit was a strategic move to lower the wallet holder’s liquidation risk amid Ethereum’s sharp decline. ETH had plummeted 15% within a single day, dropping from $2,138 to $1,813. By securing the funds on Sky, the investor effectively reduced their loan’s liquidation price to $1,127.14, significantly lower than ETH’s then-current price of $1,896. 

Despite the Ethereum Foundation’s non-involvement in this particular transaction, concerns persist over its historical practice of offloading ETH for stablecoins to fund operational costs. Just weeks earlier, on February 13, 2024, the Foundation deposited 45,000 ETH—worth approximately $120 million—into Aave, Spark, and Compound, signaling an increased reliance on decentralized finance protocols. Aave CEO Stani Kulechov responded positively, declaring, “DeFi will win.”

The market turmoil surrounding Ethereum deepened in March 2025, with the cryptocurrency plunging below $1,800 for the first time in months. The broader crypto market lost $240 billion in a single day, pushing total capitalization down to $2.6 trillion—its lowest level since November. 

Ethereum bore the brunt of the sell-off, shedding 16% in just 12 hours. With ETH now 62% below its 2021 all-time high, analysts warn that losing the $1,800 support level could pave the way for a collapse to $1,200. The ETH/BTC ratio, a key metric measuring Ethereum’s value against Bitcoin, sank to 0.023—its lowest point since December 2020. 

The wave of selling pressure from large ETH holders, or whales, has exacerbated Ethereum’s struggles. Liquidation fears have driven many to offload their holdings, further accelerating the downward momentum. Crypto Twitter has been flooded with panic, fear, uncertainty, and doubt (FUD), with critics raising fresh concerns over Ethereum’s long-term viability. 

Adding to the woes, Ethereum’s Pectra testnet suffered an attack on March 9, disrupting network functionality. A malicious actor exploited a vulnerability by sending zero-token transfers, clogging the network with empty blocks and slowing transaction finality. 

Ethereum developer Marius van der Wijden later confirmed that the issue was quietly resolved to prevent the attacker from adapting. “We suspected that the attacker was reading some of our chats, so we decided not to publicize the fix, but only update a few nodes that we controlled in order to get more full blocks on the network,” he explained.

Ethereum’s dominance is now under increased threat from both Bitcoin and Solana, with industry figures questioning its long-term position in the market. Casey Rodamor, co-founder of Ordinals, claimed Ethereum has “nowhere to go,” arguing that Bitcoin’s superior monetary properties will cement its dominance as the preferred store of value. 

Others, like Juan David Ramos, suggest that Ethereum’s shift away from full decentralization could render it obsolete. Solana, often dubbed the “Ethereum killer,” continues to attract users with its lower fees and faster transactions, though its history of network outages remains a persistent drawback. 

Meanwhile, Bitcoin’s institutional adoption is surging, with spot Bitcoin ETFs pulling in nearly $40 billion in 2024—dwarfing Ethereum’s investment products. With Bitcoin hitting a record high above $100,000 in Q4 2024, speculation of a $150,000 target in the ongoing bull cycle is gaining traction, leaving Ethereum struggling to keep pace.

This article has been refined and enhanced by ChatGPT.