Indication of a potential further decline as Bitcoin’s price plunges below $3.4k
An expert is predicting that the price of Ethereum will experience a further decline below $3,000 due to weak support levels. Within a 24-hour period, the digital asset has already dropped by 6%.
On April 2, Ethereum, the second-largest cryptocurrency, fell below $3,300 for the first time since early March as the entire crypto market experienced a downturn. The total market cap of cryptocurrencies decreased by 4.4% to $2.6 trillion on April 2, according to CoinGecko.
Ali Charts, an analyst, has expressed concerns about ETH’s correction below the $3,460 level, as it could pose challenges for crypto investors aiming for higher prices. The analyst referred to data from IntoTheBlock, which highlights the support levels where the token may find stability.
If this prediction proves to be accurate, Ethereum’s price could drop to around $2,850 or even lower. The recent decline in Ethereum’s price has already led to over $113 million in liquidations out of a total of $500 million on that day. Both long and short positions have contributed to these losses, with longs being hit the hardest, as reported by CoinGlass.
IntoTheBlock also revealed that the largest liquidation order was for an ETH-denominated position worth $7.5 million on the OKX crypto exchange.
Furthermore, a recent report from Coinbase has pointed out hidden risks within Ethereum’s rapidly growing restaking sector, despite the analysis suggesting that Ether prices may continue to decline.
Restaking and liquid restaking first gained attention in the defi sector through Eigenlayer’s initiative, which was founded in 2021 by Sreeram Kannan. However, the protocol gained significant traction in late 2022 and early last year. According to DefiLlama, the protocol currently has over $12 billion in total value locked and is the second-largest defi protocol at the moment.
Coinbase analysts David Duong and David Han have expressed concerns about nontransparent staking strategies associated with Eigenlayer and spinoff protocols like Ether.fi, warning that they could lead to negative financial and security consequences for participants. However, both analysts believe that the restaking sector will ultimately become a crucial part of Ethereum’s infrastructure.
In conclusion, it is evident that the price of Ethereum is facing challenges due to weak support levels, and the restaking sector within Ethereum’s ecosystem is also raising concerns among experts.
