China to Sell $1.3B in ETH: Ethereum Downtrend to Begin?

• China has moved 7k ETH from a total of 542K ETH seized from PlusToken scheme.
• The wallet has moved tokens for the first time since 2021. 
• A sell pressure is hovering over ETH which suggests that lower prices are possible.

China is reportedly preparing to sell $1.3 billion worth of Ether (ETH) seized from the PlusToken Ponzi scheme. The wallet holding these tokens has moved for the first time since 2021, indicating that the holders of the leading digital asset might soon witness an increased selling pressure. 

Crypto researcher ‘FreeSamourai’ reported on X that approximately 7,000 ETH of the total 542,000 ETH seized from PlusToken have been transferred to various digital asset trading platforms, suggesting that authorities are initiating the sale. This raises the possibility that ETH could drop below the $2,400 price level.

CoinMarketCap data shows that ETH is currently trading at $2,403.45, down 50.8% from its all-time high of $4,891 in 2021. The trading volume has increased 4.10% to $14.7 billion, while the market cap stands at $289 billion.

While a major sell-off by the Chinese government has not yet occurred, recent weeks have shown that the crypto market can often absorb significant FUD. Similar fears surfaced when the German government began selling its Bitcoin (BTC) holdings.

Will ETH Reclaim $2,500?

According to a TradingView chart, ETH’s price action is currently in the lower region of the Bollinger Bands, indicating that bears are in control. However, the chances of a breakout are increasing, though high trading volumes are necessary for this to happen.

Read also: Ethereum Staking Surges in 2024, 28.9% of ETH Now Staked

The Relative Strength Index (RSI) currently sits at 44.47, suggesting relatively high selling pressure. However, the upward gradient of the RSI line indicates that higher prices are possible in the short term.