Saturday sessions saw Ethereum plummeting beneath a crucial price point, trading in triple digits amidst escalated crypto market crash. The leading alternative token lost more than 10% within the past day, trading at $992.53 (Coinmarketcap data). Further declines will likely confirm massive losses for Ethereum. Remember, ETH has never touched triple digits since January 2021 before welcoming the colossal upsurge that year.
Multiple factors contribute to Ethereum’s latest massive hit. Liquidation in leading players such as Three Arrows Capital saw bears prevailing. The liquidation translated to massive Ethereum dumping on the open marketplace.
Meanwhile, Bitcoin just breached beneath the closely watched $20K zone, signaling massive liquidation. It remains unclear to what extent the bellwether crypto will slump. While publishing this blog, BTC traded at $19,127.3, dropping 9.18% within the previous 24 hours.
Next ETH Support at $800?
@PostyXBT, a crypto trader, tweeted that losing the $1,000 level would see ETH eyeing the support at $800. That level represents peaks attained during the 2018 bullish cycle. Ethereum’s future remains unclear as the altcoin broke what investors termed the last dependable support amid a bear market. The current move will likely welcome large position liquidations, triggering more Ether dumps by investors.
Coinglass data indicates $27M worth of ETH position encountered liquidations within the previous 4 hours, with most accounting for long positions.
Leveraged Trading Slams Ethereum
Macroeconomic trends (Fed Reserve rate increase and rising inflation) have contributed to Ethereum’s crash this year. Meanwhile, leverage trading by leading players like Three Arrows Capital and Celsius also deteriorated valuations.
The entities had acquired massive ETH amounts, putting stETH (Lido-Staked Ether) as capital. However, the two had to dump their assets as stETH started plunging quicker than Ethereum, leading to downside price spirals.
For now, Ethereum has its significant support floor around the May 2018 high at $830. Ethereum’s this week slide had it erasing more than $50B in market capitalization. Bears still dominate the space and could trigger more plummets in the coming sessions. Meanwhile, ETH enthusiasts should watch BTC’s upcoming price reactions as they can affect trends in the crypto space.
Feel free to share your opinions about the ongoing market crash in the comment area below.
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