Market Crash Hits Ethereum Hard
On Saturday, the cryptocurrency market took another significant hit, and Ethereum was among the worst affected.
In just a few hours, Ethereum dropped below $2,400, marking its first decline below this price since July 2nd. This represents a more than 10% decrease in a single day and an alarming 18% decline over the week.
Just a few days earlier, ETH had briefly reached $3,070, reclaiming the critical $3,000 mark ahead of the first Federal Open Market Committee (FOMC) meeting of the year. However, the asset began to plummet shortly after the Fed decided to pause rate cuts.
The situation worsened due to rising geopolitical tensions in the Middle East, triggering another sell-off on Thursday that brought ETH down below $2,800 alongside other cryptocurrencies. Interestingly, Friday turned out to be relatively quiet for crypto markets, but the overall environment for these risk-sensitive assets remains precarious.
According to reports, a significant number of Ethereum investors have been transferring their assets to trading platforms, with over 70,000 ETH flowing to exchanges in just three days.
Merlin the Trader pointed out that ETH fell through a key support level at $2,700, placing traders in a “high-stakes” situation. On a more optimistic note, another analyst, CW, noted that Ethereum whales have been net-buying the asset at levels greater than Bitcoin in the last day.
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CW informed individual investors about whale activities in the market, indicating that while many whales are profiting from short positions, they are also accumulating long positions at lower pricing levels. Notably, whales net-bought $2.97 billion on the Binance futures market and an additional $2.42 billion on the OKX futures market within a span of just 10 hours.
The recent crash of Ethereum, being the most severe among major cryptocurrencies, has affected many overleveraged traders. Data from CoinGlass shows that over $550 million in ETH longs were liquidated in the past 24 hours, surpassing the $475 million in Bitcoin liquidations.
