Ethereum Faces Critical Support Test as Market Turmoil Drives 25% Plunge

Amid a broader cryptocurrency market downturn fueled by global trade tensions, Ethereum (ETH) has experienced a severe correction, dropping nearly 25% in just five trading days. The second-largest cryptocurrency now approaches a decisive technical level that could determine its near-term trajectory, with some analysts warning of potential downside toward $1,000 if key support fails.

Ethereum on the Verge of Crash, $1,000 Calling?

In the ongoing tariff war between the United States and other countries, the cryptocurrency market has significantly plummeted. Amid this, Ethereum (ETH), the second-largest cryptocurrency, is on the verge of a major crash. According to CoinMarketCap data, ETH has lost almost 25% of its value in just five trading days and has reached a make-or-break level. While examining the weekly chart of ETH, it appears that the asset has recently lost its long-held support from the ascending trendline that had been in place since July 2022. Following the breakdown, the asset has been steadily falling, during which it has lost two key support levels at $2,200 and $1,830.

Franklin Templeton Backs $8m Seed Round for Stablecoin Project Cap

Franklin Templeton, a global asset manager expanding into the crypto and blockchain market, has led an $8 million seed round for Cap, an Ethereum (ETH)-based stablecoin project. Other participants in the round included multiple leading web3-focused venture capital firms. Cap plans to use the investment to deploy its protocol across shared security markets like EigenLayer and Symbiotic, aiming to offer a decentralized solution to yield generation in decentralized finance.

Analyst Predicts Ethereum Could Revisit $1,000-$1,500 Range This Year

Despite Ethereum (ETH) already suffering from bearish pressure and losing approximately 56% from its December 2024 high, Andrew Kang, partner at Mechanism Capital and former CFO at MicroStrategy, believes the decline may not be over. He predicts ETH could experience further significant losses and potentially revisit the $1,000-$1,500 range within the year. Kang’s assessment focuses on fundamentals, questioning the sustainability of Ethereum’s valuation given its current economics, stating that a $215B market cap for a negative growth/profitability asset is ridiculous when speculative winds have already blown past.

Ethereum Price Dips Below Holder Cost Basis, Faces Crucial Test

Ethereum price has seen extreme lows amid a market downturn, with the price currently standing at $1,542.74. This represents a significant decrease from the average purchase price of $2,200 for Ethereum holders, causing many investors to face net losses. Large-scale Ethereum holders with more than 100,000 tokens have an average cost basis of $1,290, which serves as a crucial support boundary. The market remains uncertain as Ethereum’s price continues to be affected by broader market trends.