Ethereum [ETH] dropped by 18% in less than a week after bouncing off the $2,200 support level. This happened after BTC suffered another shock and dipped to $30,000. The entire crypto market has gone into a frenzy in recent days with Luna and UST headlining the fallen market situation.
A particularly bearish sentiment swept ETH in recent days with its volume dropping by near 25% in the past 24 hours. The largest altcoin by market cap also had metrics that suggested a period of patience from the ETH community.
Daily exchange inflows tipped at $170 million, indicating an upset market for investors. Another interesting development saw the total ETH TVL in DeFi take a massive hit, as per DefiLlama. It reduced by a whopping $11 billion on 9 May and 10 May due to reduced market interest in DeFi and crypto as a whole after recent setbacks.
Source: Stat Alert
Furthermore, the number of addresses in loss reached a new high on the ETH network at press time. 27.4 million addresses were the highest number of addresses that stood in losses. This significant number was registered after May 2020.
Source: Glassnode
The transaction volumes on the network have also spiked in recent days. Furthermore, the transaction volumes reached a 3-month high of 93,188 ETH at the time of writing, while the previous high was recorded on 10 May at 93,088 ETH.
Source: Glassnode
What do the experts say…
As the atmosphere of ‘extreme fear’ looms in global markets, analysts remain confident of recovery in cryptocurrencies.
Edward Moya, senior market analyst at the foreign-exchange brokerage Oanda, stated,
“If the USD 30,000 level breaks, that could trigger a flash crash environment if several whales unload. I tweeted this April 17, 2022: ‘I am getting 2021 April-May vibes, which means potential bearish until July. Things I’m watching [include] price action, inability to effectively breakout, NFTs go off.”
On the other hand, Tyrone Ross, CEO of Onramp Invest, a crypto-asset platform for financial advisors and firms, said
“When something goes on sale and you like it, you should buy it. I think we’re not at mass adoption yet, but we are at mass acceptance. If your time horizon is 10 years, I think now is a fine time to buy it.”
While some analysts feared a crash before July 2022, others are trying to fill the cracks. It is surely a ‘wait and watch’ market situation with macroeconomic controls largely at play here.