Analysts warn of risks for Ethereum holders

The second-largest cryptocurrency’s rise above $4700 rests on expectations of a rate cut by the Fed in September. Analysts warned that if the central bank fails to deliver, the price could tumble, reports Cointelegraph.

“The main issue is that the market move is based on the assumption of a Fed rate cut next month,” said Swyftx lead analyst Pav Hundal.

At the time of writing, Ethereum trades at $4546. Its price is within 6% of the all-time high of $4878, according to CoinGecko.

Market participants put the probability of a September rate cut at 94.6%.

“It looks like the price is priced for perfection. At such times you need to be especially careful,” Hundal added, pointing to inflows into spot ETH ETFs and stable funding rates.

Capriole Investments founder Charles Edwards also believes the price of the second-largest cryptocurrency will keep rising. However, he agrees that an unexpected Fed decision could affect the market. In his words, it could “scare liquidity, when capital just freezes and flows stop.”

Edwards suggested that Ethereum will likely “quite easily double” in the coming months if bitcoin reaches $150,000–$200,000.

Not all experts are convinced a cut is coming. Morgan Stanley Wealth Management chief economic strategist Ellen Zentner noted that Fed officials could “rein in” market expectations if they judge them to be misguided.

Kansas City Federal Reserve Bank president Jeff Schmid also considers the current monetary policy “appropriate for now.”

ICO whales take profits

One early Ethereum investor moved 1060 ETH (~$5.1 million) to the Kraken exchange. According to Arkham, this was the fourth such transaction in the past four days.

Earlier, from an address beginning with 0x815, the exchange received tranches of 2000 ETH ($8.6 million), 1162 ETH ($5.2 million) and 1121 ETH ($5.2 million). Total deposits for the week reached $24.1 million.

Arkham data show the wallet still holds 4657 ETH worth $21.12 million. Transfers to exchange addresses often point to an intention to sell.

According to Onchain Lens, this participant received 100,000 ETH during the ICO, paying $31,100.

An #Ethereum ICO participant has deposited 2,000 $ETH, worth $8.55M, into #Kraken.

The whale initially received 100,000 $ETH for $31,100 at the time of the ICO.

The whale still holds 58,000 $ETH, worth $247.86M in multiple wallets.

Deposit Address:… pic.twitter.com/nu90RGpWUX

— Onchain Lens (@OnchainLens) August 11, 2025

Today that haul is valued at $471 million. Analysts noted the whale still holds more than 50,000 ETH across multiple wallets.

This is not the only early investor moving funds amid Ethereum’s rally. According to Lookonchain, on August 11 another ICO participant sent 2300 ETH (~$9.9 million) to Kraken. He obtained 20,000 ETH for $6200 in the crowdsale; they are now worth about $94 million. The address retains 1623 ETH worth $7.6 million.

Ethereum’s token sale ran from July to September 2014. The project raised about $18.3 million, selling more than 60 million ETH at an average price of $0.31.

Ethereum withdrawal queue swells

The amount of ETH queued for withdrawal from Ethereum staking has reached 671,900 ETH (~$3.1 billion). Requests began piling up amid the summer price rally.

The rise in requests has pushed waiting times from nine to roughly 12 days. By contrast, the queue to enter staking is much smaller — 105,620 ETH (~$480 million).

An analyst going by the pseudonym Ignas cited several reasons for the build-up.

1/ Record number of $ETH is in the unstaking queue:

671k $ETH = $3.2B USD

What’s more, queue wait time reached record of ~12 days.

Why is it happening? A few reasons: pic.twitter.com/W2dAXXxome

— Ignas | DeFi (@DefiIgnas) August 14, 2025

One is the closing of leveraged positions. Traders who received liquid-staking tokens (LSTs) such as stETH and borrowed against them are cutting risk as borrowing costs rise.

Another is arbitrage and concern over a possible LST depeg from ether. The decline in stETH’s rate versus ETH may have prompted participants to withdraw from staking to rotate between tokens and capture the spread. Ignas noted that Lido, EthFi and Coinbase were among the largest sources of withdrawals.

The expert also suggested that some validators are changing strategy in anticipation of new staking products in the US. In May, the US Securities and Exchange Commission clarified that the process does not violate securities rules.

Finally, with Ethereum’s price nearing record highs, some validators may simply be taking profits.

Earlier, inflows into ETFs tied to the second-largest cryptocurrency exceeded the issuance of new coins after The Merge. US spot exchange-traded funds attracted $2.45 billion in a month, roughly equivalent to about 500,000 ETH.