Ethereum News August 2025: 2 Key Reasons Why the Rally Has Stalled This Month

• Why Is Ethereum's Price Stuck in a Range?
• 1. Ethereum Whales Are Taking Profits
• 2. Bulls and Bears Battle for Control
• Ethereum Market Outlook
• Ethereum Price Action Q&A

Ethereum's bullish momentum has hit a snag in August 2025, with the altcoin struggling to break out of a tight trading range between $3,524 and $3,859. On-chain data reveals declining investor confidence and reduced whale activity, signaling potential extended consolidation or even a bearish breakdown. Here's why ETH's price action has stalled and what might come next.

Why Is Ethereum's Price Stuck in a Range?

Since July 21, ethereum has repeatedly tested resistance near $3,859 while finding support at $3,524, creating a frustrating sideways pattern for traders. The fading momentum is backed by key on-chain metrics suggesting ETH may face prolonged consolidation or a downside breakout. Let’s dive into the two main factors behind this stagnation.

1. Ethereum Whales Are Taking Profits

CryptoQuant data shows Ethereum's Estimated Leverage Ratio (ELR) has dropped to a weekly low of 0.76 across exchanges, reflecting declining trader confidence and reduced risk appetite. The ELR measures the average leverage used in ETH trades by comparing open interest to exchange reserves. When this ratio falls, it signals traders are avoiding high-leverage positions – a bearish short-term indicator.

Ethereum ELR. Source: CryptoQuant

Meanwhile, IntoTheBlock reports ETH whales (addresses holding >0.1% of supply) have significantly reduced accumulation. The netflow from large holders plummeted 224% last week as these savvy investors locked in profits rather than betting on higher prices.

ETH Large Holders Netflow. Source: IntoTheBlock

2. Bulls and Bears Battle for Control

The current standoff between ETH bulls and bears has created intense volatility around the $3,500-$3,850 range. While some traders on BTCC and other exchanges still hope for a breakout above $3,859, the weakening fundamentals suggest bears might gain the upper hand.

A breakdown below $3,524 could trigger a slide toward $3,067, according to TradingView analysts. Conversely, if bulls regain strength, we might see ETH finally conquer the $4,000 psychological barrier – though current metrics make this scenario less likely in the immediate term.

ETH Price Analysis. Source: TradingView

Ethereum Market Outlook

The current market dynamics present a classic "wait and see" situation. With reduced leverage trading and whale accumulation, ETH lacks the fuel for a significant upward move. However, the $3,500 support has held strong through multiple tests, suggesting some underlying demand.

As one BTCC market strategist noted: "We're seeing traders position cautiously ahead of September's major network upgrades. The current consolidation might continue until we get clearer signals from both technicals and fundamentals."

Ethereum Price Action Q&A

Why has Ethereum's price stalled in August 2025?

ETH's price stagnation stems from declining leverage trading activity and profit-taking by large holders, creating reduced buying pressure at key resistance levels.

What does the low ELR ratio indicate?

The 0.76 ELR shows traders are avoiding risky Leveraged positions, typically preceding periods of low volatility or downward price movement.

How significant is the whale activity drop?

The 224% weekly decline in large holder netflow represents one of the most substantial profit-taking events since ETH's 2024 rally, signaling weakened institutional confidence.

What are the key price levels to watch?

$3,524 support and $3,859 resistance remain critical. A breakout in either direction could determine ETH's medium-term trend.