ethereum continued its free fall against bitcoin and hit its lowest level since April 2021. It is down more than 55% from its highest point in 2021.
Ether sell-off is accelerating
ethereum (eth) was trading at 0.039 btc, down 24% this year and 35% from its year-to-date high. It has also fallen against other cryptocurrencies such as Solana (SOL), Binance Coin (BNB) and Tron (TRX).
The same has happened in terms of the US dollar, with the currency falling for four consecutive months and now trading near $2,300, which is its lowest point since February.
The ethereum sell-off is likely due to a weak response from institutional investors, who have largely avoided spot ETFs. eth-spot” target=”_blank” rel=”nofollow”>The data shows Ether ETFs have seen net outflows of over $581 million. They currently have $6.62 billion in assets, a much lower figure than bitcoin spot funds, which have over $54 billion and have seen net inflows of $18 billion.
The price of ether has also declined due to the recent liquidations by the ethereum Foundation and Vitalik Buterin. Buterin has sold $2.2 million worth of tokens, while the foundation has sold 350,000 coins.
<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter“/>
Most importantly, there are concerns that ethereum is losing market share to layer-2 networks like Base, Arbitrum, Polygon, and Blast, which are known for faster speeds and lower transaction costs than ethereum.
There are also signs that many smart investors are selling the coin. For example, one investor sold nearly $10 million worth of eth in the past 24 hours, as shown below.
<img loading="lazy" decoding="async" width="2807" height="648" src="https://crypto.news/app/uploads/2024/09/eth-smart-money.jpeg” alt=”Nansen, smart money”/>
Another major entity selling its ethereum assets was Jump Trading, one of the major players in the cryptocurrency industry. According to Nansen, its total Ether holdings fell from over $531 million in July to zero.
<img loading="lazy" decoding="async" width="2394" height="797" src="https://crypto.news/app/uploads/2024/09/Jump-Trading.jpeg” alt=”Jump Trading Assets”/>
ethereum has more disadvantages in terms of btc
<img loading="lazy" decoding="async" width="3574" height="1982" src="https://crypto.news/app/uploads/2024/09/ETHBTC.png” alt=”From ethereum to bitcoin“/>
The current sell-off in Ether began after it formed a triple top chart pattern around the 0.088 level between May 2021 and September 2021. The coin then fell below the pattern’s neckline at 0.049 on May 20 this year.
A death cross pattern also formed in April, when the 50-week and 200-week moving averages crossed over each other.
The Relative Strength Index has pulled back and retested the oversold level of 30, indicating strong bearish momentum. Therefore, the path of least resistance for Ether is down, with the next reference point being 0.0224, which would represent a 42% drop from the current level.
