Ethereum price drops after hack #2 – But why investors aren’t panicking

• Oxinfin hacker buys 17,696 ETH worth $49.5 million.
•  Ethereum investors remain optimistic despite a 3.49% decline over the past day.

Over the past week, Ethereum [ETH] has been in the middle of scandals. Following the hack of Bybit days ago, investors’ concerns were shortly addressed, with the ETH supply on the exchange becoming stable again.

However, there has been another hack.

Hacker buys 17,696 ETH worth $49.5 million

In the past day, another concern has faced Ethereum. This follows a new account that was created, and 49.5 million DAI spent on buying 17,696 ETH tokens.

At first, Lookonchain reported this transaction as a massive whale accumulation. Shortly after, the transaction was flagged as a hack.

As reported by Lookonchain, Stablecoin bank Oxinfini was hacked, and 49.5 million USDC was stolen. The hacker then swapped 49.5 million USDC for 49.5 million DAI.

This hacker used the stablecoins to buy 17,696 ETH. After the purchase, these tokens were transferred to the newly created account that was earlier reported as a whale accumulation.

Such a hack is bad news not only for Oxinfini but also for ETH because of its continued association with hackers.

A bad reputation could affect Ethereum’s investor sentiments, resulting in a negative impact on its price charts.

Any impact on Ethereum?

As expected, this news has negatively impacted Ethereum’s price action. As of this writing, Ethereum was trading at $2705. This marked a 3.49% decline on daily charts.

Equally, ETH has declined across the charts, dropping on weekly and monthly charts by 2.89% and 18.8%, respectively.

Source: CryptoQuant

Despite the continued decline on its price charts, Ethereum investors remain optimistic. As such, investors continue to buy ETH.

This is evidenced by the spike in Buyer Taker Sell ratio, which has hiked to 1.085 from a low of 0.9. When the buyer index crosses 1, it implies there is a higher buy than sell orders.

Thus, Ethereum is currently experiencing a higher buying pressure.

Source: CryptoQuant

Additionally, U.S. investors, especially institutions, continue to accumulate ETH.

This buying activity is confirmed by a positive Coinbase premium index, which has recovered over the past day after dropping to negative territory.

When the Coinbase premium index is positive, it implies that U.S. investors are aggressively buying the asset.

Source: Santiment

Finally, the continued buying activity has boosted Ethereum’s scarcity in the market. As such, ETH’s stock-to-flow ratio has surged over the past week to 99.13.

When SFR rises, it implies that ETH on supply has reduced relative to demand. A rise in scarcity helps push prices higher if demand remains constant or rises.

In conclusion, although Ethereum has experienced scandalous news, this has yet to affect investor’s sentiment. With buyers trying to retake the market while sellers are also active, ETH is left at a crossroads.

Therefore, the prevailing market conditions mean that Ethereum will continue to trade sideways within a range of $2.5k and $2.8k.