Ethereum drops 30% but still sees whales adding positions. Will the market reverse after ETF positions are deeply trapped?

On February 11, news reports indicate that since 2026, Ethereum (ETH) has continued to weaken, with the year-to-date decline exceeding 30%, and the price once fell below the $2,000 mark. The latest data shows ETH trading at approximately $1,971. The main holding groups—including long-term accumulated addresses and ETF investors—have all entered an unrealized loss zone. However, there has been no panic-driven capital outflow, and the market presents a complex pattern of “price pressure and stable chips.”

On-chain analyst CW8900 pointed out that the current ETH price has fallen below the realized average price established during whale accumulation since June 2025, indicating that many core addresses are in a floating loss. Meanwhile, the on-balance sheet loss of the world’s largest Ethereum vault, BitMine, has exceeded $7 billion. Nevertheless, data shows these addresses have not withdrawn en masse; instead, they continue to add positions at low prices.

ETF holders are also under pressure. Bloomberg senior research analyst James Seyffart stated that the average cost basis for ETH ETFs is around $3,500. Currently, the decline exceeds 60%, making their situation even more severe than Bitcoin ETFs. Despite this, net ETF inflows have only decreased from about $15 billion to below $12 billion, with most funds still holding rather than liquidating.

More notably, on-chain fund movements are worth attention. The net position change indicator for Ethereum exchanges has turned negative, indicating withdrawals are higher than deposits, which is often seen as a long-term bullish signal. Recently, BitMine repurchased 40,000 ETH and added 140,400 ETH to staking, bringing its total staked amount to 2.97 million ETH—nearly 70% of its ETH holdings—showing that institutions are still betting on the network’s long-term value.

The current Ethereum market is in a phase of confidence and price dislocation. Although short-term volatility is intense, the continued positioning by whales and institutions suggests they prefer to build long-term positions at low levels. Future trends may depend on the overall recovery pace of the crypto environment and whether ETH can regain key technical levels.