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The crypto collapse continues: Ethereum, we need to talk
By Daniele Corno
In just 70 days, Ethereum has eroded all the gains generated in 2024, and a price below $2,000 is sounding the alarm
We need to talk
Each market cycle for the crypto sector acts as a gateway for a new audience, and today, the sector is exposed without filters to the general public.
It is well known that attention comes after a strong rally in prices, which brings with it the hope of “easy gains”, attracting large masses. With great speed today, the market has already punished the “latecomers” driven by FOMO, but not only them.
When Bitcoin’s price breaks through its All-Time-High (ATH) and enters a phase of price discovery, the liquidity generated by the huge profits migrates to Ethereum which, in turn, reaches new ATHs and, in turn, directs the liquidity to the Altcoin market. This has been the case in previous cycles, although the current market seems to be following a very different logic.
This logic was partly observed in the rally at the beginning of 2024 when, for the first time since 2021, Bitcoin surpassed its previous ATH in the $69,000 area. Even then, the strength of Ethereum was extremely reduced compared to Bitcoin. In fact, after exceeding $4,000, 20% from its all-time highs, the price found its TOP.
From that moment on, Ethereum experienced a period of great difficulty, raising multiple doubts about its medium-term performance.
No “Bullish” signals on the charts
At the time of writing, ETH is trading at $1,900, -54% from its highs in December 2024, and -43% on the annual chart. In just 70 days, the ETH dump has eroded all the gains made in 2024, trading at well below the $2,300 price at the beginning of 2024.
Too many metrics down
The drop in ETH has eroded the TVL present in DeFi in just three months, going from peaks of $80 billion to current values of just over $45 billion.
The Revenue generated by Ethereum, with a Gas in the range of 0.5-2 GWEI for over three months, is at its lowest peak since 2020 when DeFi was still in its infancy. We are talking about weekly Revenue of less than $5 million, a figure never reached even in the Bear Market of 2022-2023.
The period of suffering for ETH does not seem to be coming to an end despite strong technological and regulatory development. The market now remains strongly negative on the second cryptocurrency on the market, with doubts and fear the order of the day.
Talking about a reversal is premature. New narratives are needed but above all, a real use of the “global computer”, which is lacking today.
