Ethereum (ETH) Risks Decline As Fidelity Transfers ETH to Coinbase

Cryptocurrency markets faced increased selling pressure on Monday as financial giant Fidelity transferred over $200 million worth of Ethereum (ETH) to Coinbase.

The massive influx of coins into the exchange raised concerns that it could exacerbate the existing downward pressure on the Ethereum price.

Fidelity Transfers Large Sum of ETH to Coinbase

Asset management firm Fidelity’s crypto arm has been actively transferring large sums of ETH to leading exchange Coinbase over the past 48 hours.

According to crypto intelligence firm Arkham, the first two transactions, each involving the transfer of 20,000 ETH to Coinbase, were completed on January 8.

The final transaction, executed on Thursday, saw the deposit of 11,250 ETH, valued at $36.51 million, to Coinbase.

These transactions, which are part of a broader movement of coins into exchanges, have led to a spike in the coin’s exchange inflow volume.

Data from on-chain analytics firm Glassnode shows that on January 9, a staggering 550,930 ETH, valued at over $1 billion, was sent to exchange addresses—marking the highest single-day inflow since December 2023.

Coin Exchange Inflows Signal Selling Pressure

This growing accumulation of ETH in exchange wallets could intensify the downward pressure on its price if the market demand fails to absorb the increased supply.

When an asset’s exchange inflow surges, it signals increased selling pressure as holders transfer assets to exchanges, potentially to liquidate.

If sell orders outweigh demand, this trend can lead to downward price movements.

ETH Exchange Inflow Surges as Price Drops Further

The readings from the ETH/USD one-day chart showed no such demand in the altcoin market to absorb the growing supply.

Its declining Relative Strength Index (RSI) reflects this weakening buying pressure. At press time, this momentum indicator is on a downward trend at 42.73.

ETH’s RSI readings indicate weakening momentum, with the asset nearing oversold territory but not yet critically undervalued.

If buying pressure wanes further, ETH’s price could drop below $3,249 and plummet toward $3,027.

On the other hand, if exchange inflow stalls and demand climbs, it may drive the Ethereum price up to $3,758.