The Ethereum price has fallen by around -25% since its mid-March peak at around $4,100 and is currently trading just above $3,000. While this loss is in line with the broader market trend and in particular Bitcoin’s price drop of about -22% in the same time, there could be another reason for ETH’s price slump, which seems plausible since the German government only sells BTC and not ETH, and Mt. Gox doesn’t own any ETH either. But what if Ethereum has its very own “Mt. Gox“?

Is The Ethereum Price Suppressed By Golem?

Chinese crypto journalist Colin Wu (@WuBlockchain) first reported via X on the significant movements of ETH funds by the Golem project, an Ethereum-based project that conducted a notable Initial Coin Offering (ICO) in 2016. According to Wu, “Golem, a project that raised 820,000 ETH in ICO in 2016, has transferred 36,000 ETH to Binance, Coinbase, Bitfinex, etc. in the past 37 days, worth about $115 million.”

On-chain analysis service Lookonchain further revealed the extent of these transactions via X: “Golem has sold 24,400 ETH ($72M) on Binance, Coinbase and Bitfinex in the past 3 days, and currently holds 127,634 ETH ($372M). Golem raised 820,000 ETH through ICO in November 2016, when the price of ETH was only $10.2.”

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The Golem ICO was an early and significant event for the crypto industry which took place in November 2016. Golem aimed to create a decentralized supercomputer by harnessing the combined computing power of users’ machines, from personal laptops to entire data centers. The idea was to allow users to rent out their computing resources to others.

In its ICO, Golem raised approximately 820,000 ETH, which was valued at around $8 million at the time, in just 29 minutes, becoming a symbol of the ICO bubble. This funding was supposed to be used to develop the Golem network. Despite its ambitious goals, Golem’s market relevance has significantly diminished, with its token now trading at just $0.32 (#151 by market cap), a stark decline from its peak price of $1.32 in January 2018.

Harsh Criticism From Crypto Experts

Criticism has been vocal among industry leaders. Adam Cochran, a partner at CEHV, expressed his displeasure via X: “Absolute bastards. Sat on their ETH for ages doing nothing. And here we are in the era of demand for distributed compute and they can’t even be relevant.”

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Similarly, Jimmy Ragosa, an advisor at Sismo, sarcastically remarked, “Yes, Golem has been dumping on us. But, at least, they are using these 100s of millions of dollars to build critical scaling infra and widely adopted apps, right?”

Another perspective came from @based16z on X, who speculated on the rationale behind Golem’s actions, “Say what you want about Golem, but they’re not exactly a gambler. For them to dump 700 million dollars in ETH after 7 years, I assume they know something.”

How strong the influence of Golem sales is on the ETH price remains pure speculation. However, it seems clear that the constant selling pressure has probably played at least a certain role in the Ethereum price slump. At press time, ETH traded at $3,049.

Featured image from Shutterstock, chart from TradingView.com

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The crypto market is currently navigating through a turbulent phase, particularly for Ethereum, which has seen a significant downturn of nearly 15% in its value over the past week.

Amid this negative price performance, Peter Schiff, a well-known economist and a skeptic of cryptocurrencies, has chosen to add salt to the wounds by projecting a stark prediction for ETH. According to Schiff, Ethereum could plummet to as low as $1,500, marking a substantial decline from its current levels.

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Shiff’s Bearish Outlook And Community Reaction

Schiff’s prediction comes when Ethereum is trading below the previous crucial support of $3,000 mark, a sharp 30% fall from its peak above $4,500 in March.

This decline coincides with heightened speculation surrounding the potential launch of an Ethereum spot exchange-traded fund (ETF), which seems to have triggered a premature sell-off among investors instead of propelling the price.

Schiff’s commentary suggests that the market’s response to the ETF rumors has been to liquidate positions rather than hold, adding further downward pressure on Ethereum’s price.

He expressed his view on Elon Musk’s social media platform, X, stating, “It looks like those buying the Ethereum ETF rumors couldn’t wait for the fact to sell,” indicating a market driven by speculation rather than sustained investment confidence.

While Schiff’s bearish outlook has garnered attention, it has also sparked a mix of skepticism and agreement within the crypto community. Users have expressed varying opinions on social media platforms, with some questioning the technical basis of Schiff’s $1,500 target.

Others humorously noted that Schiff’s pessimistic predictions often come at market bottoms, suggesting his views might inadvertently signal a buying opportunity. For instance, one user remarked on the irony of Schiff’s timing, indicating that his bearish predictions could contradict market sentiment indicators.

thx for your inputs

you do realize you only become relevant on this side of twitter as a bottom signal lol

youre like those acoustic wif kids who had a stroke on stage the wif party as a top signal

— agent pretzel (@agent_pretzel) July 5, 2024

Ethereum Faces Critical Juncture

Ethereum is experiencing a significant downturn, trading at $2,975—a 4.2% drop over the past day. This decline and Bitcoin’s similar trajectory have led to a 4.1% reduction in the global cryptocurrency market cap, erasing more than $200 billion in value.

According to Coinglass, this downturn has triggered substantial losses for traders, with 207,020 liquidations in the past day, totaling $576.53 million. Ethereum-related liquidations account for $134.58 million, predominantly from long positions.

While Peter Schiff’s outlook may seem too pessimistic amid these market conditions, another voice in the crypto analysis sphere, Inspo Crypto, offers a slightly more moderate view.

He notes that Ethereum’s price has fallen to early May levels and suggests that the next 8-hour trading window could be crucial in determining the market’s direction.

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If Ethereum can rise above these levels, it might potentially ease the bearish trend. However, failure to reach the $3,170 mark (which it already has) could lead to further declines, possibly down to $2,700, exacerbating losses across the altcoin market.

$ETH has broken down below $3,170. The next 8 hours (1D candle) will show whether the bulls have given up or not. If the price retraces back above, we should consider this a deviation. But if $ETH instead retests the lower trend channel next at $3,170 unsuccessfully, it could… pic.twitter.com/1msfKQBf2v

— InspoCrypto (@InspoCrypto) July 4, 2024

Featured image created with DALL-E, Chart from TradingView