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Whales Bet on Ethereum To Plunge to $400 This Summer: Report

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Sat, 7/01/2023 - 20:00
Whales Bet on Ethereum To Plunge to $400 This Summer: Report
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Chinese crypto journalist and blogger Colin Wu has tweeted that some crypto whales are believed to have bet on Ethereum to plunge to the $400 level via put options.

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Wu cited @Blofin_Official, the account that shared the crypto analytics data. According to their tweet, an order has been placed of 26,000 Ethereum put options. The strike price for it was set at $400, the options will expire June 30 this year.

The strike price of a put option implies that when the option expires, a trader can sell the underlying asset at this price level even if it goes lower.

Thus, some whales are likely to bet on the second largest cryptocurrency to drop to the $400 level, which was last seen in late 2020. However, Wu added that this could also be tail management behavior as whales are buying large amounts of put options to protect their positions.

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Ethereum (ETH) Devs Agreed on Major Change of Shanghai Agenda

A user in the comment thread assumed that the whales might be expecting the ETH price to plummet that much once the Ethereum locked in the ETH 2.0 deposit contract is allowed for withdrawals after the Shanghai upgrade. This upgrade is scheduled for the first quarter of this year — half a year after the Merge took place in mid-September.

As the Merge was implemented, Ethereum switched to the proof-of-stake consensus protocol from the proof-of-work one, thus becoming more energy saving compared to Bitcoin, LTC, DOGE and other first generation cryptos that are mined via PoW.

At press time, Ethereum is changing hands at $1,263, having shown a small rise of 1.53% in the last 24 hours, according to CoinMarketCap data.

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