According to LookOnChain, the price of Ethereum (ETH), the second-largest cryptocurrency by market cap, has dropped below major key levels.
But despite the dip, large ETH holders are aggressively buying the dip.
Ethereumâs price has failed again to overcome the critical $3,000 level. At press time, ETH is trading near $2,926, down about 7.7% over the past week. This leaves many investors asking: Why is Ethereumâs price going down?
Why is the Ethereum price going down?
The second-largest cryptocurrency by market cap has dropped in price due to these three major factors: broader market instability, institutional investor withdrawals, and growing competition from alternative blockchains.
Currently, the entire crypto market is unstable and experiencing significant turbulence, and ETH is not immune to this instability. The Crypto Fear & Greed Index currently sits in âfearâ territory. When fear dominates the industry, even strong cryptocurrencies like Ether tend to suffer.
Secondly, the Federal Reserve (Fed) policies are creating uncertainty that puts pressure on risk assets like cryptocurrencies. This triggered institutional investor withdrawals, hurting speculative investments like Ether.
Finally, Bitcoinâs decline is dragging Ether lower. Recently, the price of Bitcoin (BTC) has dropped to $86,000, its lowest since May. This decline triggered a ripple effect across altcoins.
Ether, well-known to typically track Bitcoinâs movements, plunged, even steeper, as BTC fell sharply.
Notwithstanding the price decline, on-chain data shows large holders actively accumulating ETH on dips.
Large investors continue buying ETH on the drop
On-chain data reveals that Ethereum whales are steadily and aggressively buying the token even as price action remains weak. A particular over-the-counter whale address recently bought another 20,000 Ether tokens worth about $56.13M.
Over the past five days, the same whale address accumulated 70,013 Ether tokens, valued roughly $203.6M.
Reports also revealed that World Liberty Financial (WLF), a business venture linked to the Trump family, is moving its investment from Bitcoin into Ether.
According to LookOnChain, WLF swapped 93.77 WBTC worth about $8.08M for 2,868 Ether tokens earlier on January 26, 2026.
That same day, a long dormant Ether wallet possibly linked to Bitfinex moved 50,000 Ether tokens worth $145.25M to Gemini after 9 years of inactivity.
All these ETH purchases and transfers by large investors increased Etherâs trading activity. On January 26, 2026, CoinMarketCap data shows ETH 24-hour spot trading volume has jumped 250% to $350B.
Rising whale activity signals potential ETH price rise
Although Ethereum is currently trading below its main moving averages, its 20-day moving average is close to $3,050, while the 50-day moving average sits near $3,100.
This keeps short-term control with ETH sellers. Despite the current weakness, large holders continue to add the token. According to CryptoQuant, large ETH investors accumulated over 350,000 ETH in a single day last week.
CryptoQuant data revealed that the realized price for major ETH accumulation addresses nears the current market price.
Meanwhile, balance on these accumulation addresses continues to rise to new highs.
A CryptoQuant analyst proposed that this pattern suggests that large Ethereum (ETH) investors are anticipating a price rally while retail investors remain cautious.