Ethereum has continued its decline against Bitcoin, reaching its lowest level since April 2021. The cryptocurrency has plummeted over 55% from its peak in 2021.

Ethereum’s Accelerating Sell-Off

Recently, Ethereum (ETH) was trading at 0.039 BTC, marking a 24% decline this year and a 35% drop from its year-to-date high. It has also lost ground against other cryptocurrencies like Solana (SOL), Binance Coin (BNB), and Tron (TRX).

In US dollar terms, Ethereum has fallen for four consecutive months and is now trading near $2,300, its lowest point since February.

Weak Institutional Interest

The ongoing sell-off is likely due to a lackluster response from institutional investors, who have largely avoided spot ETFs. Data shows that Ether ETFs have experienced net outflows of over $581 million. Currently, they hold $6.62 billion in assets, significantly lower than spot Bitcoin funds, which boast over $54 billion and have seen net inflows of $18 billion.

Liquidations by Key Players

Ethereum’s decline is also attributed to recent liquidations by the Ethereum Foundation and Vitalik Buterin. Buterin has sold tokens worth $2.2 million, while the foundation has sold 350,000 coins.

A wallet related to vitalik.eth sold 190 ETH for 441,971 USDC 20 minutes ago!

The wallet received 3,800 ETH ($9.8M) from Vitalik and has sold 950 ETH ($2.28M) at an average price of $2,396 since August 30.

Market Share Concerns

There are growing concerns that Ethereum is losing market share to layer-2 networks such as Base, Arbitrum, Polygon, and Blast, which offer faster speeds and lower transaction costs.

Additionally, smart money investors are showing signs of selling off their Ethereum holdings. For instance, one investor sold ETH worth nearly $10 million in the last 24 hours.

Major Entity Liquidations

Jump Trading, a prominent player in the crypto industry, has also sold off its Ethereum assets. According to data, its total Ether holdings dropped from over $531 million in July to zero.

Technical Analysis

The ongoing Ether sell-off began after forming a triple-top chart pattern around the 0.088 level between May and September 2021. The coin then dropped below the pattern’s neckline at 0.049 on May 20 of this year.

In April, Ethereum also formed a death cross pattern as the 50-week and 200-week moving averages crossed each other. The Relative Strength Index has retreated and retested the oversold level of 30, indicating strong downward momentum. The next reference point for Ethereum could be 0.0224, representing a 42% drop from the current level.

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