Ethereum Drops 1.39% Below $1,900 Amid Market Pullback

Ethereum, the second-largest cryptocurrency by market capitalization, has experienced a notable decline, dropping below the $1,900 mark with a 24-hour change of -1.39%. This downward trend is part of a broader market pullback, influenced by geopolitical tensions and tariff concerns. The cryptocurrency has been on a downward trajectory for the past month, with a significant drop in value. This decline has been driven by broader crypto market pullbacks, geopolitical tensions, and tariff concerns.

The recent price drop has raised concerns among investors and analysts, who predict further declines if the cryptocurrency fails to sustain a firm recovery above $2,200. The underperformance of Ethereum comes at a time when the decentralized finance (DeFi) sector is facing backlash due to its role in helping hackers obfuscate stolen funds. If Ethereum's price falls to $1,000, it could trigger massive liquidations and dampen investors' interest in DeFi, noted a key expert. The top altcoin's underperformance comes at a time when DeFi is facing backlash due to its role in helping hackers obfuscate stolen funds.

Ethereum has been one of the worst-performing coins among top cryptocurrencies in the past year, falling to levels last seen in November 2023 following the recent crypto market crash. Since December 2024, the total value locked (TVL) across all DeFi protocols has declined, while that of Ethereum is down. If ETH continues the downward trend, especially with speculations of a potential bear market looming, it could spark major liquidations and discourage new investment in the sector.

The prediction comes at a time when DeFi still faces backlash from aiding the hackers who exploited crypto exchange for about $1.5 billion in ETH to obfuscate the funds. The attackers leveraged cross-chain protocol to swap over 70% of the stolen ETH for BTC, with a DEX on the protocol, earning fees for facilitating most of the swaps. Proponents of DeFi argue that the decentralized nature of these platforms absolves them of responsibility for illicit activities conducted by users. Meanwhile, critics insist that such protocols and positions are incompatible with the law.

Ethereum's decline could trigger huge risks in DeFi. Ethereum serves as the foundational platform for a vast majority of DeFi projects, and a substantial price drop could lead to decreased total value locked (TVL) across DeFi protocols, reduced liquidity, and diminished investor confidence. The optics and perceived instability could prompt users to seek alternative platforms or delay participation in DeFi ventures, potentially stalling innovation and growth within the sector.

Ethereum has been struggling for directional bias within a key rectangular channel, a move it has maintained since declining below $2,200 and finding support near $1,750. The Relative Strength Index (RSI) is below its neutral level, while the Stochastic Oscillator (Stoch) is in the oversold region, indicating that bears still dominate ETH's market. The momentum could shift toward bulls if the Stoch sees a firm cross above its moving average line. A weekly candlestick close above $2,200 will invalidate the thesis.

Ethereum has been stuck in a tight range, trading below $1,900 and above $1,750 after days of heavy selling pressure. The broader crypto market remains volatile, with Ethereum's price movements reflecting the overall market sentiment. The cryptocurrency's decline below the $1,900 “robust” demand zone may bring significant new buying pressure for the world's second-largest cryptocurrency. However, sustained failures to see a firm recovery above $2,200 put a decline to $1,500 in the picture, especially as it marks the next rectangular channel major support.