From January 3 to January 26, 2026, in the UTC+8 time zone, two massive on-chain swaps brought an anonymous whale into the spotlight: first, they exchanged 14,145 WETH for 492.16 WBTC, and then, 23 days later, they swapped back 578.66 WBTC for 17,706 WETH, making significant moves between ETH and BTC. At the same time, Bloomberg analyst Mike McGlone issued a pessimistic warning stating that “the risk of Ethereum falling below $2,000 is greater than the possibility of it rising above $4,000.” Wall Street traders leaned towards a defensive stance, while on-chain data showed that the overall ETH holdings of whales increased by about 6.45%. On one side, there were anonymous large holders increasing their Ethereum positions, while on the other, traditional institutions emphasized liquidity contraction and valuation pressure. This long and short bet on the future trend of ETH is unfolding simultaneously on-chain and on Wall Street.
Two Swaps Back and Forth: Is the Whale Bottom-Fishing or Getting Trapped?
● Swap Timeline Restoration: On January 3, this whale completed the first large swap, exchanging 14,145 WETH for 492.16 WBTC, which indicates a proactive shift from Ethereum to Bitcoin exposure after ETH weakened relative to BTC. By January 26, the same address acted again, swapping 578.66 WBTC back for 17,706 WETH, not only returning all the previously acquired WBTC back to ETH but also increasing their WETH position beyond what they had on January 3, creating a complete loop of “first exiting ETH and then amplifying the replenishment.”
● Cost and Profit/Loss Range: By analyzing the ETH/BTC exchange rate fluctuations from January 3 to January 26, it can be inferred that the whale's first swap of 14,145 WETH → 492.16 WBTC was more likely executed when ETH was relatively weak and BTC was relatively strong, followed by a “reverse amplification” of ETH exposure with 578.66 WBTC ↔ 17,706 WETH later on. Since the brief did not provide the matching prices and slippage for each transaction, precise calculations cannot be made, but the fact that the amount of WETH swapped back is significantly greater than the initial holdings indicates that they actively increased their ETH risk exposure in the second transaction. Even if short-term price fluctuations may lead to unrealized losses, their position structure has clearly tilted towards ETH.
● “Lightning Reverse” Whale's Unrealized Loss Pressure: Another whale, referred to as “Lightning Reverse” by the market, has a more intuitive unrealized loss position: approximately 199.4 BTC with a cost of $87,584.2 per coin, while also holding about 4,321.8 ETH at an entry price of approximately $2,872.85 per coin. With current prices below the entry costs, this portion of the position is clearly in a state of paper loss. Although we do not know their complete asset structure, looking solely at these two positions, the short-term unrealized losses have amplified this whale's dependence on a market rebound, highlighting the drawdowns and risk exposure faced by recent bets on ETH and BTC rebounds.
ETH Capital Return: 6.45…
● Overall Increase in Whale Holdings: According to statistics from PANews and Planet Daily, the net ETH holdings of whales have recently increased by about 6.45%. Given the current total market capitalization, this proportion corresponds to a considerable increase in capital. It is not a reflection of retail sentiment fluctuations but rather the result of multi-address, long-term capital continuously flowing back into ETH on-chain. Unlike the short-term operations of individual large holders, this type of increase is closer to a reallocation of Ethereum risk exposure.
● Comparison of WBTC and WETH Flows: From the two large swaps of WETH ↔ WBTC mentioned above, it can be seen that the whale first converted WETH to WBTC and then, weeks later, swapped back to WETH in a larger scale, aligning with the overall trend of “ETH holdings increasing by 6.45%.” This rotation from BTC to ETH suggests that some long-term capital believes Ethereum has more elasticity in relative valuation and future growth, willing to sacrifice Bitcoin's safe-haven attributes, extending their time preference, and betting on ETH's Beta and narrative premium in the upcoming cycle.
● Historical Cycle Implications: Looking back at previous cycles, such large-scale reallocations from BTC to ETH on-chain often occur in two scenarios: one is an increased expectation for a mid-market narrative restart for public chains and application layers, and the other is some capital attempting to speculate on a temporary rebound in the ETH/BTC exchange rate. This round of whale swaps is not yet sufficient to define a major cycle turning point, but against a backdrop of macro uncertainty and bearish sentiment, the willingness to bear short-term volatility with large ETH accumulations resembles a preemptive bet on the recovery of public chain ecosystems, transaction fees, and on-chain activities.
Wall Street's Bearish Sentiment: Ethereum…
● Mike McGlone's Core Judgment: Bloomberg senior analyst Mike McGlone publicly stated, “the risk of Ethereum falling below $2,000 is greater than the possibility of it rising above $4,000,” clearly skewing the probability distribution of price downward. His argument is not aimed at a single project but is based on concerns about the current macro environment: in a context of high interest rates and global liquidity withdrawal, growth-oriented high-risk assets are under pressure, and ETH, as a high-volatility asset, naturally falls into the category of “easily re-priced.”
● Bearish Macro Framework for ETH: In McGlone's logic, tightening liquidity means capital will withdraw from risk assets, gradually flowing back to cash, government bonds, and traditional safe-haven assets, leading to overall valuation compression for crypto assets. He particularly emphasizes that ETH is more dependent on ecological activity, DeFi, and on-chain demand compared to BTC. Once macro headwinds, regulatory uncertainties, and declining risk appetite overlap, Ethereum's valuation elasticity will shift from an advantage to a leverage that amplifies declines. Therefore, under his framework, ETH should receive a higher risk premium discount.
● Whales Acting Against the Trend and Research Reports: Chronologically, between January 3 and January 26, there were two large WETH/WBTC swaps and an overall increase in ETH holdings by 6.45%, while pessimistic views and price warnings continued to spread in the Wall Street discourse during the same period. This dissonance between “large on-chain accumulations” and “traditional research being bearish” makes the whale's actions appear as if they are countering expert panic—when public research reports emphasize that the $2,000 support is precarious, some capital is executing multiple large cross-asset swaps, betting that the market will eventually correct the current pessimistic pricing at some future point.
On-Chain IPO and New Licenses in Hong Kong:…
● Long-Term Demand Imagination for On-Chain IPOs: Coinbase CEO Brian Armstrong proposed that “on-chain IPOs will significantly reduce financing costs,” directly linking core aspects of traditional capital markets with public chain infrastructure. In this vision, corporate equity issuance, clearing, and settlement can be completed on public chains like Ethereum, which means higher demands for the throughput, stability, and security of underlying public chains, while also providing potential long-term demand anchors for assets like ETH—when more capital market activities migrate on-chain, the “settlement fuel” and “staking security” value carried by native public chain assets will be re-priced.
● Compliance Channels of Hong Kong's Mox Bank and HashKey: On the regulatory front, Hong Kong's Mox Bank has been approved to provide BTC and ETH trading services and has partnered with HashKey, indicating that regionally licensed digital asset services are extending into a broader banking system. This not only provides local users with a more compliant and lower-threshold import and export channel but also signals to regional and global capital that “BTC and ETH are gradually being incorporated into the compliant financial system.” Even if short-term trading volumes may not explode immediately, the increase in the number and types of compliant entry points is itself an important indicator of long-term capital interest.
● Discrepancy Between Medium-Long Term Benefits and Short-Term Bearish Sentiment: On one side, there are medium-long term institutional benefits imagined from on-chain IPOs, bank licenses, and compliance platform expansions, while on the other, there is short-term bearish sentiment formed around interest rate hikes, economic slowdown, and a sharp decline in risk appetite. At the current stage, these two forces are clearly misaligned: the pace of macro and regulatory benefits being realized is often slow, while price reactions to sentiment and liquidity are extremely rapid. The whales amplifying their ETH exposure at this time are, to some extent, using time to exchange for space, betting that when these medium-long term benefits gradually materialize, the market will reassess the valuation center of ETH.
The Bet Between Whales and Analysts: Who is…
● Macro Risks and Risk Aversion Preferences: On a larger scale, factors such as increased expectations for US-Japan exchange rate intervention and policy swings in major economies have caused traditional market funds to refocus on defensive and safe-haven assets. Voices from institutions like State Street strategists have reinforced the consensus that “monetary and interest rate uncertainties remain high.” In this environment, most funds tend to prefer short-duration bonds, cash positions, and high-grade credit assets, naturally keeping their distance from high-volatility, high-Beta crypto assets, and are more likely to accept conservative or even pessimistic judgments like McGlone's.
● Underlying Contrast of Logical Discrepancies: In contrast, the logic of whales increasing their ETH holdings is entirely different: one side emphasizes structural pressure from “risk asset compression” from the perspective of liquidity and valuation contraction; the other side views Ethereum as the core of future on-chain finance and application infrastructure, starting from technological and application expansion. The former places more importance on the macro cycle position, believing that it is still not suitable to embrace high-volatility assets; the latter focuses more on protocol layer upgrades, ecological expansion, and future demand, seeing price declines as a window to improve input-output ratios.
● Key Variables Behind the Bet: This bet is not just a dispute over price direction but also a different wager on several key variables: the pace of macro easing determines the starting point for the overall risk asset valuation recovery, the speed of compliance progress affects whether and when institutional funds can enter the Ethereum ecosystem on a large scale, and Ethereum's own upgrade path (performance, privacy, data availability, etc.) determines whether it can support heavier applications like on-chain IPOs and institutional settlements. Whales are betting on these variables improving together in the medium to long term, while analysts are more concerned about whether the market will face one or even multiple rounds of “valuation cleansing” before these stories materialize.
The Chips are in Place: What’s Next for Ethereum…
The two large WETH/WBTC swaps completed by whales between January 3 and January 26, along with the overall increase in ETH holdings of about 6.45%, form the first clue of capital flowing back into Ethereum on-chain; the warnings from experts like Mike McGlone about the “greater risk of falling below $2,000” represent Wall Street's conservative attitude towards liquidity and risk assets; and Brian Armstrong's discussions about on-chain IPOs, the licensing of Hong Kong's Mox Bank, and partnerships with HashKey outline a longer-term institutional upward channel on the regulatory and application front. These three clues intertwine to sketch a picture of a highly divergent short-term landscape, but a medium-long term narrative that is being restructured in the ETH long-short game.
In the foreseeable future, ETH prices are likely to continue to fluctuate violently amid macro expectations and emotional volatility, making it difficult to determine a winner between bearish research reports and whale accumulations in the short term. However, from the evolution of capital structure and policy environment, funds are quietly reconstructing the pricing of Ethereum's risks and returns: on one end, there are more compliant and institutionalized capital entry points, and on the other, there are more infrastructure-like on-chain application visions. The current price fluctuations may just be laying the groundwork for the next phase of trends.
When on-chain IPOs become a reality, regulatory channels mature, and banks and licensed institutions fully enter, will the dominant buyers of Ethereum be the whales quietly accumulating on-chain today, or the traditional institutions gradually entering through compliant channels? The answer to this question may very well be the ultimate direction of this round of bets between whales and analysts.
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