Ethereum is entering a tense week as nearly 880,000 ETH are scheduled for release from staking, a move that could unleash around $2 billion worth of liquidity into the market.
Traders fear that if even a fraction of those tokens are sold, the resulting pressure could push ETH into a sharp correction.
Selling fears meet fragile price levels
Market analysts warn that the unlock comes at a delicate time. Ethereum is hovering just above the $4,000 support zone, a level seen as pivotal for maintaining bullish momentum. Any sustained selling could drag prices 5–7% lower, with $4,200-$4,300 flagged as heavy resistance that bulls have repeatedly failed to break.
Hedging over speculation
Options data suggests traders are playing defense. Greeks.Live noted that $4,000 puts remain expensive due to high implied volatility, making them a costly way to hedge. Instead, mixed strategies and spreads are being favored to guard against sudden swings without overpaying for protection.
Broader backdrop
This potential supply shock coincides with wider macro uncertainty. Investors are also watching for signals from the U.S. Federal Reserve, with speculation of an upcoming interest rate cut that could sway appetite for risk assets like Ethereum.
Large staking withdrawals don’t always translate into immediate selling, but they often act as catalysts for short-lived volatility. With ETH sitting at a critical juncture, the coming days may decide whether the token can stabilize above support or slip into a deeper pullback.
