OpenSea Trading Volume May Force Ethereum Price Crash, Expert Says
January 24 2022 - 8:48AM
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Ethereum’s latest price decrease was fueled by increased altcoin
inflows to cryptocurrency exchanges. Experts attribute the drop in
Ethereum’s price to direct transfers from the NFT marketplace
OpenSea. OpenSea Transaction Volume Dangerous For Ethereum
According to Etherscan data, OpenSea has been unloading thousands
of ETH on the market in the last few weeks. Similarly, NFT creators
on the platform have profited, according to the statistics. The
volume of NFT trading on OpenSea continues to climb in January.
Since the start of 2022, OpenSea, the largest NFT marketplace, has
seen extraordinary NFT sales. According to Dune Analytics, monthly
NFT sales on OpenSea currently exceed $4.5 billion. This sum
surpasses their previous monthly sales record of $3.5 billion and
is expected to rise further. The volume of Ethereum exiting has
steadily climbed over the last two weeks. 21,000 Ethereum were
directly transferred from OpenSea’s wallet to Coinbase. Related
article | OpenSea Transaction Volume Shows That NFTs Are Not
Slowing As the selling of NFTs increases, so do royalties and
direct transfers from OpenSea. The precipitous rise of the NFT
marketplace may enhance Ethereum inflows to exchanges such as
Coinbase. As royalties from OpenSea, an extra 35,300 Ethereum were
distributed to NFT issuers. Colin Wu, a Chinese journalist and
crypto analyst, argues that the surge of Ethereum inflows from
OpenSea to Coinbase spurred the increase in selling pressure.
Historically, a surge in selling pressure causes the altcoin’s
price to fall. Colin Wu tweeted: “OpenSea and NFT issuers may be
one of the pressures for ETH to crash. In the past two weeks, the
amount of ETH transferred directly from OpenSea Wallet to Coinbase
reached 21,000, and the amount of ETH transferred to royalty
distributors reached 35,300.” Analysts have noticed that the net
outflow for Ethereum in 2021 was relatively large. The net inflow
of Ethereum has increased significantly during the last month.
ETH/USD nosedives to $2,200. Source: TradingView IAmCryptoWolf, a
pseudonymous cryptocurrency analyst, assessed the Ethereum price
trend and forecasted that a bounce in the altcoin’s price around
$2,300 would act as strong barrier. $ETH. Working on 78.6fib,
monthly 21EMA and horizontal daily and weekly support
2.2-2.3k.Since we lost 3k key support, a bounce in this area will
act as strong resistance. In the same area we will also have daily
DMA50 curving down together with the WMA50 and WEMA21 resistances
pic.twitter.com/ngR2YsCzqC — Wolf 🐺 (@IamCryptoWolf) January 23,
2022 Ethereum Net Position Change - All exchanges. Source:
Glassnode However, OpenSea is not the sole cause of the drop in the
price of ETH. According to Coinmarketcap data, ether is down more
than 35% year to date. Over $746 has been deducted from the value
of ETH in the previous 14 days, as it has fallen below $3,000. ETH
is presently trading at $2,407, a -3.71% decrease over the previous
24 hours. Other Factors That May Trigger Price Fall Several reasons
have contributed to the crypto market crisis, including a broad
market selloff in response to a policy shift by the US Federal
Reserve Bank. The changing policy direction of Russia toward crypto
is among the contributing factors to consider. Market participants,
on the other hand, remain bullish on Ether in the long run. Several
upgrades that the network intends to roll out this year are fueling
these expectations. For starters, the next stage of Ethereum’s
journey to becoming a proof-of-stake (PoS) blockchain is planned
for this year. Several forecasts claim that the merger will take
place in the first half of 2022. This improvement will increase the
Ethereum network’s scalability and greatly contribute to making
Ether issuance deflationary. As a result, it will encourage
adoption and, in the long run, drive up the price of Ethereum.
Related article | TA: Ethereum Nosedives, Indicators Show Signs of
Larger Downtrend Featured Image from Shutterstock | Charts by
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