What happened

For crypto investors, there's blood in the streets right now. Marketwide contagion fears have led to dramatic declines across most cryptocurrencies, with Ethereum (ETH -0.26%) participating in this sell-off. As of 11:30 a.m. ET today,  this token is marginally higher (0.3%) over the past 24 hours, and it has surged by 4% since midnight. However, keeping this rally in context, over the past week, Ethereum has declined by more than 22%.

Its slight rally today appears to be tied to investors taking a step back to digest the carnage that has already been done. Concerns around the financial crisis of crypto exchange FTX have bled into valuations across the sector, as crypto investors are unclear of just how systemic its filing for bankruptcy protection could be for the overall space.

Interestingly, reports that have surfaced today that Ethereum's founder, Vitalek Buterin, sold 3,000 ETH during the FTX-related contagion have done little to spark a sell-off. Rather, investors appear to be taking the view that a near-term rally is more likely, considering how hard most tokens have been hit.

So what

It's certainly concerning to see influential individuals in the crypto space selling into what has been an incredible decline over the past week. What sparked these sales for Buterin remains unclear. However, there's certainly a fair amount of skepticism among investors looking at crypto right now, and these insider sales don't inspire confidence from those seeking to buy this dip.

Aside from macro concerns, which have taken most risk assets lower this year, the crypto sector is one that's battling its own set of headwinds. While Ethereum appears to remain among the highest-quality cryptocurrencies out there, insider selling activity is the last thing many long-term investors want to see right now.

Now what

I still think Ethereum is among the best crypto assets out there, despite this recent market turmoil. Most investors clearly take the same view, with today's rally rather unexpected, considering the news that's been circulating of late.

That said, I think patience may be rewarded for investors looking for the best entry point right now. It's possible many cryptocurrencies could see lower lows in the days and weeks to come.

It's hard to be a long-term buy-and-hold investor right now. That said, the best returns are often seen by investors who buy after periods of intense selling. Whether we see another leg lower, or a stabilization rally over the near term, remains to be seen. However, Ethereum remains a top crypto that investors will want to watch closely moving forward.