Ethereum Faces Critical Pressure as BlackRock’s Massive Sell-Off Meets Tepid Demand

BlackRock's sudden Ethereum liquidation sends shockwaves through crypto markets—just as institutional demand hits unexpected lows.

The Perfect Storm

Wall Street's crypto darling faces its toughest test yet. BlackRock's reported sell-off coincides with weakening institutional appetite, creating a brutal combination that's hammering ETH prices. The world's largest asset manager moving against Ethereum? That's not just noise—it's a seismic shift.

Liquidity Crunch

Trading volumes are drying up faster than a desert stream. Without fresh institutional money flowing in, Ethereum's price discovery mechanism is breaking down. The smart contract pioneer is learning the hard way: even revolutionary tech can't defy gravity when the whales start selling.

Market Psychology Turns

Remember when every dip was a 'buying opportunity'? Those days are gone. The narrative has flipped from 'digital gold 2.0' to 'risk asset'—and traditional finance isn't known for its patience during drawdowns. Another day, another reminder that Wall Street's love affair with crypto lasts exactly as long as the quarterly performance numbers hold up.

Ethereum Struggles to Break Key Resistance Levels

ETH has also failed to climb past the $4,500 mark, which has now turned into strong resistance. The daily chart shows a pattern of lower highs and lower lows, a bearish signal. Even when Ethereum tested the resistance level, it lacked the buyers needed to push higher. Spot buying volumes remain weak, as data highlights negative net spot flows on exchanges. Without real demand, price recovery attempts continue to stall.

This struggle at resistance raises the risk of a deeper pullback. Analysts warn that if ETH breaks below $4,200, the next stop could be $3,550. The descending triangle forming on charts supports this bearish case. Still, traders note potential bounce levels around $3,750 to $3,900, which could provide temporary relief. In either case, ETH needs stronger participation from buyers to reclaim the $5,000 level.

Ethereum Network Activity Declines with Price

Network fundamentals have also weakened. Ethereum revenue dropped by 44% in August, falling to $14.1 million from July’s $25.6 million. That decline happened even as ETH reached record highs just weeks earlier. The slump is partly tied to the Dencun upgrade in March, which cut fees for layer-2 networks. While the upgrade improved efficiency, it also reduced fee revenue, lowering ETH’s deflationary effect.

At the same time, total network fees slipped by 10% to about $43.3 million over the past month. Lower fees mean less value is burned, reducing the token’s scarcity advantage. Combined with falling open interest in ETH futures—down 18% from recent highs—the data reflects weaker overall demand. Both spot and derivatives markets show traders are stepping back, further capping price growth.

Ethereum Outlook: Short-Term Pain, Long-Term Hope

Despite the bearish tone, Ethereum’s long-term picture may not be as grim. Large treasury investors continue to accumulate ETH. For example, BitMine Immersion holds over $9 billion worth of the token, making it the largest corporate holder. Other firms like SharpLink have also built major positions. These big buyers see long-term value in ETH even as short-term volatility persists.

Moreover, stablecoin activity on the Ethereum network remains strong, with assets topping $154 billion. This robust ecosystem gives ETH a fundamental backbone that could support future rallies. Once selling pressure from BlackRock and continued ETF outflows fade, demand may rebound. History shows that crypto often recovers quickly after deep corrections. For now, however, ETH must navigate heavy resistance and weak buyer momentum.