Ethereum Price 5% from Danger Zone Despite BlackRock’s $2.5B BUIDL

Key Insights:

• Ethereum price sits at $1,958, only 5% above the critical $1,847 support level.
• BlackRock BUIDL holds $2.5 billion on Ethereum, but whales sold 160,000 ETH.
• Hidden bearish divergence signals weakening momentum as breakdown risk grows.

Ethereum price trades around $1,950 at press time. That sits just 5% above a critical support level. BlackRock launched BUIDL, a $2.5 billion tokenized fund built mostly on Ethereum. Sounds like huge institutional adoption. Yet whales reduced their holdings by 160,000 ETH since early February.

The biggest institutional endorsement in Ethereum’s history is not translating into buying pressure. Something does not add up.

Ethereum Price Rebounds from $1,700

Ethereum price hit a low of $1,700 on Feb. 6. It bounced from there to current levels near $1,958. That looks like recovery on the surface. But the rebound lacks strength.

The gap between the current price and the $1,847 support level is only 5%. One bad day erases that cushion completely. Below $1,847, the next support sits at $1,658. After that, $1,504 comes into view. Both levels represent significant drops from here.

Ethereum Price Levels | TradingView

Technical indicators are flashing warnings, too. The RSI, which tracks momentum, shows a hidden bearish divergence. This happens when price makes lower highs while RSI makes higher highs. For Ethereum, that pattern formed over recent weeks. Price peaked, pulled back, tried to rally again, but made a lower peak. RSI during that same period made a higher peak.

Hidden bearish divergence suggests weakening buying power during rallies. It means each bounce-up gets weaker even though the indicator temporarily looks stronger. Those divergences often resolve with sharp moves lower once sellers take over.

Ethereum price needs to break clearly above the resistance to change this setup. But right now, it just hovers near support as the technical structure deteriorates. The rally from $1,700 brought some relief. It has not brought conviction.

BlackRock’s $2.5B BUIDL Shows Adoption as Whales Sell

BlackRock launched BUIDL in March 2024. The fund tokenizes US Treasury bills and repos, offering institutional investors yield through blockchain technology. Assets under management now sit at approximately $2.5 billion. That makes it the largest tokenized real-world asset fund in existence.

BUIDL operates primarily on Ethereum. Around 90% of its assets live on the Ethereum network. Ethereum also holds roughly 65% of all tokenized assets across the entire crypto market. BlackRock choosing Ethereum validates the network’s position as the infrastructure layer for institutional tokenization.

This should be massively bullish for the Ethereum price. Major financial institutions building products on your network usually drive demand. But the on-chain data tells a different story.

Ethereum Whales | Source: Santiment

Whale holdings, measured by supply held by large addresses excluding exchanges, dropped from 113.93 million ETH on Feb. 3 to 113.77 million ETH on Feb. 12. That is a reduction of 160,000 ETH in just over a week. Large holders are selling, not buying.

Ethereum Price Struggles Despite Biggest Tokenization Milestone

The disconnect between institutional adoption and price action comes down to how BUIDL actually works. The fund does not buy Ethereum directly. It uses Ethereum as infrastructure to tokenize Treasury assets. Institutions participating in BUIDL hold tokenized Treasuries, not ETH itself.

This creates utility for the Ethereum network. More transactions, more activity, more validation of Ethereum as the settlement layer for real-world assets. But utility and token demand are not the same thing. A busy network does not automatically mean more people buying ETH.

Gas fees paid for BUIDL transactions do create some ETH demand. But the amounts are tiny compared to those generated by speculative trading. Institutions are not loading up on ETH to hold for the long term. They are using Ethereum to move tokenized dollars and Treasuries around.

Whales possibly see this disconnect clearly. They understand that institutional infrastructure adoption takes years to translate into meaningful token price support. The narrative sounds good. The actual mechanics do not create immediate buying pressure. So they sell into strength rather than accumulate into weakness.

Another possible explanation is that large holders are rotating into other assets. Bitcoin has shown relative strength in some recent periods. Other Layer 1 chains offer higher yields through staking or DeFi. Ethereum’s value proposition as infrastructure is long-term. Short-term trading dynamics favor more volatile or higher-yielding alternatives.

Ethereum price needs several things to break higher. First, hold the $1,847 support firmly. Second, invalidate the hidden bearish divergence by making a higher high with strong momentum. Third, see some actual accumulation from whales or institutions show up in on-chain data. None of those are happening yet. Until they do, the 5% gap to danger stays uncomfortably small

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