Ether holds the $3k support level as BitMine buys more ETH: check forecast

Ether, the second-largest cryptocurrency by market cap, has lost the $3,100 support level after losing 4% of its value in the last 24 hours.

The coin briefly dropped below $3k but is now trading around $3,054 per coin. 

BitMine acquires more ETH coins despite market selloff

ETH’s bearish performance comes despite the Ethereum treasury company, BitMine Immersion Technologies, announcing on Monday that it acquired 54,156 ETH last week, bringing its holdings to 3.56 million ETH.

The firm added that it had reduced its stake in Worldcoin (WLD) treasury Eightco Holdings (ORBS) from $61 million to $37 million.

Thanks to this latest development, BitMine now holds $11.8 billion in total assets, including a 192 Bitcoin (BTC) stash and $607 million in unencumbered cash.

The recent purchase was BitMine’s lowest acquisition since launching its ETH treasury in July.

This comes as the broader crypto market has been experiencing bearish price action over the past few weeks. 

According to BitMine’s Chairman, Thomas Lee, the current market weakness indicates that a key market maker is suffering from a declining balance sheet. He added that,

When a market maker has a ‘hole’ on their balance sheet, they are seeking to raise capital and are reducing their liquidity functions in the market. This is the equivalent of QT (quantitative tightening) for crypto and has the effect of dampening prices. In 2022, this QT effect lasted for 6-8 weeks. And this is probably happening today.

However, Lee believes that crypto prices haven’t peaked for this cycle, adding that the market could rally for another 12-36 months. 

Onchain data by CryptoQuant reveals that BitMine currently sits on an unrealised loss of about $3 billion following the sustained decline in ETH in recent weeks.

CryptoQuant contributor Maartunn added that, for context, at the depths of the bear market, MicroStrategy’s unrealised loss peaked at $1.9 billion. 

BitMine remains the largest ETH treasury, ahead of SharpLink Gaming (SBET) and The Ether Machine (ETHM).

Furthermore, data obtained from SoSoValue reveals that US spot Ethereum exchange-traded funds (ETFs) recorded $728.5 million in net outflows last week, their third largest on record.

ETH eyes the $2,850 support amid selling pressure

The ETH/USD 4-hour chart remains bearish and efficient as Ether has underperformed in recent weeks.

The recent plunge below $3k liquidated $166.8 million in futures liquidations over the past 24 hours, led by $132.1 million in long liquidations.

ETH has bounced back above the $3k psychological level, but could face further selling pressure in the near term.

A failure to recover the $3,100 level could see sellers dominate the market and push ETH toward the $2,850 key level.

The next key support level lies around $2,380.

On the flipside, if ETH recovers above the $3,100 resistance level, it could retest the $3,470 high in the near term. 

The Relative Strength Index (RSI) and Stochastic Oscillator (Stoch) on the 4-hour chart are around their oversold regions, indicating a dominant bearish momentum.

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