Erherum has been dropping for nearly three months and is still struggling to bounce back. It hit a high of $4,100 in December 2024, but since then, it has crashed more than 53%, now sitting at about $1,878, according to CoinMarketCap. This drop is fueled by the selling pressure from investors.
Analysts from Bitfinex say one big problem is the uncertainty around U.S. import tariffs. Some investors fear a trade war could shake up financial markets, and risky assets like cryptocurrencies are feeling the heat. Another issue is that developers aren’t building as many new projects on Ethereum, partly because of high operating fees.
“A lack of new projects or builders moving to ETH, primarily due to high operating fees, is likely the principal reason behind the lackluster performance of ETH. We believe that for ETH, $1,800 will be a strong level to watch,” the analyst said.
Meanwhile, it’s not just Ethereum; the whole crypto market is feeling the wave. Even Bitcoin (BTC), which was sitting at $80,155, is at risk of dropping to $70,000.
Nansen analyst Aurelie Barthere said this is part of a “macro correction”, meaning financial markets as a whole are adjusting. But she also points out that the market is still technically in a bull cycle, so all hope isn’t lost.
Another major factor dragging Ethereum down is ETF outflows. Investors are pulling money out of U.S. spot Ether ETFs, and it’s been happening for four weeks in a row. Data from Sosovalue shows that over $119 million left the market just last week.
This has made it harder for ETH’s price to recover. Stella Zlatareva, an editor at Nexo, explained, “ETH’s 20% decline last week pushed its price below the key $2,200 trendline that had supported its bull market recovery since 2022.”
But even with all this, some big players still believe Ethereum has a bright future. VanEck, an investment firm, predicts ETH could hit $6,000 in 2025 while Bitcoin could soar to $180,000. For now, though, ETH remains in a tough spot.
Also Read: Strategy to Plan $21B STRK Sale to Buy More Bitcoin