Ethereum is witnessing a significant change in derivatives positioning, with a sharp decline in high-leverage long positions throughout the market. The reduction indicates that numerous excessively bullish trades have either been voluntarily closed or compelled out due to recent liquidation events. Crypto investor and data analyst on X highlighted that Ethereum is currently experiencing a notable deleveraging phase, with high-leverage long positions seeing a substantial decline throughout the market. Simultaneously, there has been a slight uptick in short positions, suggesting that the bearish side of the market is not yet fully saturated. The current level of high-leverage exposure is relatively modest, indicating a decrease in systemic risk when compared to previous periods.
Additionally, the majority of the greedy long positions have been liquidated, and focus is now turning to the potential liquidations of short positions. In this current market phase, Ethereum whales are exhibiting a behavior that hasn’t been observed in more than a year, which could indicate a significant change in market dynamics. Ali Charts, an analyst, has disclosed that starting from October 6, 2025, wallets containing between 1,000 and 10,000 ETH have experienced a notable shift in their market behavior. Prior to this shift, this group was engaged in a consistent accumulation phase. From April to October 6, 2025, their holdings surged from around 12.95 million ETH to close to 15.95 million ETH. However, that trend has now taken a sharp turn.
Since October 6, mid-tier whale holdings have seen a drop from 15.95 million ETH to approximately 12.52 million ETH, marking a 21.5% decrease in their overall position. As a significant volume of supply floods the market due to whale distribution, any potential rally toward the $3,000 mark may hinge on a new surge of institutional or retail demand that can effectively absorb the selling pressure. Ethereum is displaying ongoing signs of vulnerability compared to Bitcoin, as recent market movements highlight a more delicate short-term framework. Crypto trader KriptoHolder has observed that selling pressure on ETH has increased, driving price action down toward the $2,273 area.
Simultaneously, retail traders are predominantly leaning towards the long side, with about 73.19% adopting a bullish stance, while short positions hover around 26.80%. This scenario indicates a crowded trade that frequently faces risks during market downturns. However, the Whales vs Retail Delta currently stands at -22.01, indicating that the whale-side continues to exert considerable selling pressure. As reported, ETH is expected to require two significant changes: a decrease in aggressive selling from whales and the resurgence of substantial buying support in the spot market, before a more robust upward rebound can be anticipated. Currently, ETH seems to be in a more precarious situation, as market internals indicate a lack of resilience compared to BTC.