📉 COMPRESSED CONVICTION: ETHEREUM SLIDES BELOW ETF COST BASIS AS WHALES DOUBLE DOWN ON ACCUMULATION

Ethereum (ETH) is entering a high-stakes phase of price discovery, having shed over 30% of its value year-to-date to trade near $1,971 as of February 11, 2026. This sharp decline has pushed the asset well below the estimated average cost basis for both accumulation whales and ETF holders, the latter of which sits near $3,500. While BitMine the world’s largest ETH treasury is currently weathering over $7 billion in unrealized losses, on-chain data suggests a remarkable display of “diamond hands.” Exchange net position changes have turned negative, signaling massive withdrawals for self-custody, while institutional players like BitMine continue to stake thousands of ETH, signaling a long-term commitment to the network’s architectural future.

Under Water: The $7 Billion Paper Loss at BitMine

The depth of the current drawdown has placed even the largest institutional participants in a significant unrealized loss position.

• The BitMine Squeeze: As ETH dipped below $2,000, the unrealized losses for BitMine swelled from $6 billion to over $7 billion. Despite this, the firm remains aggressive, purchasing another 40,000 ETH yesterday and staking 140,400 ETH to reinforce its long-term network participation.
• Staking as a Shield: Approximately 68.7% of BitMine’s total ETH holdings (2.97 million ETH) are currently staked. This strategy suggests that institutional giants are prioritizing network yield and security over short-term price fluctuations.

ETF Resilience: Holding the Line at $3,500

Bloomberg Intelligence analysts have noted that Ethereum ETF holders are currently facing a more severe relative selloff than their Bitcoin counterparts.

• The Cost Basis Gap: With ETH at $1,971, the gap between the current price and the estimated $3,500 ETF cost basis is substantial. Total net inflows into Ethereum ETFs have cooled from $15 billion to roughly $12 billion.
• Diamond Hands: Despite a peak-to-trough drawdown of over 60% comparable to the April 2025 crash most ETF investors have remained in place. This lack of broad exit activity suggests that institutional capital views the current sub-$2,000 level as a temporary dislocation rather than a fundamental failure.

Whale Behavior: Aggressive Accumulation Below the Realized Price

On-chain data confirms that the largest wallets in the ecosystem are treating the current dip as a generational buying opportunity.

• Breaking the Realized Price: Ethereum has fallen below the average entry level of accumulation addresses that began building positions in June 2025.
• Negative Exchange Flow: More ETH is being withdrawn from exchanges than deposited. This “accumulation drain” reduces the immediate sell-side liquidity available, potentially setting the stage for a sharp supply-shock-driven recovery once broader market sentiment stabilizes.

Essential Financial Disclaimer

This analysis is for informational and educational purposes only and does not constitute financial, investment, or legal advice. Reports of Ethereum trading below a $3,500 ETF cost basis and BitMine’s $7 billion unrealized loss are based on market data and third-party analysis as of February 11, 2026. “Unrealized” losses do not indicate realized capital depletion unless assets are sold. Staking digital assets involves significant risks, including smart contract vulnerabilities and potential “slashing” penalties. Ethereum remains a high-risk asset subject to extreme volatility; the 30% year-to-date decline highlights the potential for total capital loss. Always conduct your own exhaustive research (DYOR) and consult with a licensed financial professional before making significant investment decisions in Ethereum or digital asset ETFs.

Do you think the whales are right to “double down” below $2,000, or is the $7 billion BitMine loss a sign that a deeper capitulation is coming?