Ethereum Drops Below $2.2K Amid Sell-Off Fears
Key Takeaways
- Ethereum (ETH) recently saw long positions worth USD 165 million liquidated.
- An early ICO investor transferred 1,700 ETH worth USD 3.18 million to Binance – possible intent to sell.
- Ethereum network activity is declining: fewer transactions, decreasing user numbers, lower revenue.
- The ETH price broke through a key support level at USD 2,200 – further downside potential possible.
- The current market environment suggests uncertainty about Ethereum’s role as an investment.
Massive Liquidations Weigh on the Market
In recent days, long positions on Ethereum worth approximately USD 165 million have been liquidated. Such liquidations occur when traders use leverage to bet on rising prices, but the market moves in the opposite direction. As a result, positions are automatically closed to limit losses.
This development indicates that trader sentiment is currently low. Weak buying power and high market liquidity could lead to further short-term price declines.
ICO Investor Movement Raises Concerns
An Ethereum investor who had been inactive for seven years recently deposited 1,700 ETH worth about USD 3.18 million to Binance. Movements by so-called “whales” – large investors – can trigger uncertainty. Market participants are speculating whether a sale is imminent, which could add additional selling pressure.
Whether this move is truly intended for selling remains unclear. If the investor is merely reallocating or strategically using the coins, the situation could stabilize.
Decline in Transactions and Users
On-chain data shows that activity on the Ethereum network is decreasing. The number of daily transactions remains stable at around one million, which is below previous levels. The number of active addresses is also declining, now below 750,000.
Nevertheless, the monthly user base remains solid at over 10 million addresses. This suggests that Ethereum is still being used, but growth has stagnated.
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Key Support Level Broken
The current ETH price has fallen below the so-called “max pain” level at USD 2,200. This level is considered psychologically important, as it often acts as support. A breakdown of this level can lead to further losses if there is no counter-movement.
Ethereum as an Investment or a Network?
Recent data suggests that Ethereum is currently being used more as a technical network rather than as an investment asset. Stagnant user growth, falling transaction volumes, and sales by large investors argue against short-term price gains.
In the long term, Ethereum remains relevant due to its function as a smart contract platform. However, in the current market environment, risks outweigh the opportunities for investors.
Our Assessment
Ethereum is in a critical phase. The combination of declining user numbers, high liquidations, and whale activity is creating uncertainty. Short-term volatility is to be expected. Anyone considering investing in ETH should closely monitor the current market environment and account for potential risks.
In the long term, Ethereum remains technologically significant. But as an investment, caution is advised at this time – especially with leveraged positions.
Sources
- CryptoQuant
- Onchain Lens
- X (formerly Twitter)
| Symbol | ETH |
| Coin type | Alt Coin |
| Transaction Speed | Medium |
| Pros |
|
| Cons |
|
| Further practical applications | |
| Price | $1,846.99 |
| 24h % | 1.94 % |
| 7d % | -9.72 % |
| 30d % | -16.97 % |
| 60d % | -42.57 % |
| 1y % | -48.79 % |
| Market Cap | $222,687,352,623.00 |
| Official Links | Website | Source Code |
| Socials | Reddit | X |
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