Vitalik Buterin: his state of mind in February amidst the Ethereum crisis

In February, the crypto community closely watched Ethereum founder Vitalik Buterin’s movements. His recent market actions drew significant attention, especially amid a sharp decline in ETH’s price. Over the last weeks of February, Vitalik Buterin substantially reduced his holdings by selling a large amount of ETH, coinciding with one of the most challenging periods for the network.

Major Movement: 17,000 ETH During a Volatile Period

Vitalik Buterin sold approximately 17,000 ETH tokens, worth around $43 million. This was done gradually through a decentralized protocol called CoW, broken into many small swaps instead of a single large transaction. This approach helps minimize slippage when dealing with large volumes but spreads market pressure more evenly over time.

According to Arkham Intelligence, wallets attributed to Ethereum’s founder held about 241,000 ETH at the start of the month. By the end of February, this amount had decreased to 224,000 ETH, reflecting a consistent outflow of funds—including $6.6 million in the first three days and another approximately $7 million in the final days of February.

Background: February Crash and Staking Yield Compression

The timing of these actions was unfortunate—ETH lost 37% of its value in February, dropping to around $1,900. Vitalik’s ongoing sales added extra pressure on the token, which was already struggling to generate a positive narrative.

The situation was worsened by another factor: over 30% of ETH supply remains locked in staking, but the yield from staking has shrunk to about 2.8%. This lower return makes staking less attractive compared to risk-free alternatives, reducing incentives for network participants.

Connection to Philanthropic Initiatives

In January, Vitalik Buterin announced a $43 million (16,384 ETH) allocation for projects related to privacy, open hardware, and secure software. This decision was made amid Ethereum Foundation’s period of “moderate austerity,” while maintaining the technical development roadmap. He stated that the funds would be used gradually over several years, which explains the series of small transactions.

Ripple Effect: Corporate Holders Under Pressure

Vitalik’s selling wave coincided with broader pressure on corporate ETH holders. One of the largest, Bitmine Immersion Technologies, is suffering billions in unrealized losses. ETH’s roughly 60% decline over six months has caused current prices to fall well below the average purchase price.

From February to March: Early Signs of Recovery

As of early March, the situation began to change. While ETH traded near $1,900 at the end of February, by March 8, the price had recovered to $1,970. Over a 30-day period, a positive trend was observed: a 7.75% increase indicates a gradual recovery after the February shock.

The asset holdings of major holders, including Vitalik Buterin himself, remain under close community scrutiny. Any further market actions by him will continue to influence investor sentiment and could serve as an indicator of confidence in the protocol’s long-term prospects. The coming weeks will show whether ETH can consolidate its recovery and build a new bullish narrative.