Ether Plummets 53% Amid Trade War Fears, ETF Outflows

Ether is currently facing a significant correction, with its price at risk of falling to $1,800. This downward trend has been ongoing for nearly three months, with the cryptocurrency's value dropping by more than 53% since its peak above $4,100 in December 2024. The primary drivers behind this correction are macroeconomic concerns, particularly fears surrounding US import tariffs and the potential for a trade war, as well as continued selling pressure from US Ether exchange-traded funds (ETFs).

Analysts from Bitfinex have attributed the lackluster performance of Ether to a decrease in new projects and builders moving to the Ethereum network. High operating fees are cited as the main reason for this decline in activity. The analysts also noted that the current sell-off is not isolated to Ether, but rather part of a broader market correction as risk assets are impacted by tariff fears. They highlighted that $1,800 will be a crucial level to monitor for Ether.

Adding to Ethereum’s challenges, continued outflows from Ether ETFs are limiting the asset’s price recovery. The digital asset investment platform Nexo noted that Ether's 20% decline last week pushed its price below the key $2,200 trendline that had supported its bull market recovery since 2022. This modest price action is attributed to the impact of ETFs, similar to the situation with Bitcoin. US spot Ether ETFs have experienced net negative outflows for four consecutive weeks, with over $119 million worth of cumulative outflows in the previous week.

Despite the current challenges, some institutional crypto market participants remain optimistic about Ether’s price for 2025. VanEck, for instance, predicted a $6,000 cycle top for Ether’s price during 2025. However, the immediate outlook remains bearish, with the combination of trade war concerns and ETF outflows creating a challenging environment for Ether. The ongoing uncertainty and loss of confidence among investors have led to a decrease in demand, resulting in the current price correction.

As long as these factors persist, Ether is likely to continue facing corrections in the near future. The downward trend, coupled with the lack of new projects and high operating fees, suggests that Ether may struggle to reverse its current trajectory without significant changes in the market dynamics. Investors will be