Ethereum Drops 24% in June Amid Global Uncertainties

In June, the crypto market experienced a lackluster performance due to global uncertainties surrounding international tariff policies and the future direction of US central bank rates. The S&P 500 Index gained 4.25% for the 30-day window ending June 27, reaching a historic record close on Friday. Bitcoin, after a significant rally from April to May, saw minor gains in June, which was seen as a positive development given the global turmoil. Ethereum, on the other hand, corrected by 24% before bouncing off support on June 22, finalizing a 2% loss for the month. Despite this, Ethereum is not necessarily facing issues that Bitcoin does not. Ethereum is a smaller currency by market cap, about 14% of Bitcoin’s size, and is perceived as a more speculative bet, leading to larger percentage movements in both directions.

Bitcoin is the leading indicator for the crypto market, including Ethereum. According to popular and authoritative analysts’ price targets for Bitcoin in 2025, it is expected to enter July and Q3 at 50% to 66% of its peak price before this cycle is over. This suggests that Bitcoin could double or gain by half again its June price levels before the year is over. Ethereum’s long-term trend chart indicates a potential three-peat of a multi-year trend, suggesting that Ethereum prices could rise by more than Bitcoin’s during the next big monthly rally. If Bitcoin’s final push for its peak on this cycle occurs as market watchers expect, Ethereum’s gains could signal the start of this cycle’s alt season in meme coins and Layer 2 app tokens.

Ethereum’s price has taken time to absorb the shock of the Dencun upgrade on March 13, 2024, which lowered rates for Layer 2 apps. Since then, developers have deployed new apps with currencies that offer Ethereum services for lower fees, causing the base chain’s fee revenue to drop from $30 million annually to $500,000 by Q1 of this year. This has led to a sluggish price growth for Ethereum compared to Bitcoin. However, the money mostly didn’t leave Ethereum and go to its competitors; it went to another layer, powered by and supporting the base chain. This suggests that Ethereum may be undervalued by a large number of the cryptocurrency market’s headline readers that don’t understand what happened.

SharpLink Gaming bought another $30 million worth of ETH just before the Ether price chart threw a small cup and handle pattern. This corporate treasury race for Bitcoin supplies continues to rock the Ethereum markets. Led by founder and executive chairman Michael Saylor, Strategy Inc. and Bitcoin have both benefited from the company’s pivot in 2020 to simply pile up as much BTC as it can hold on to forever. As a result, MSTR stock rallied 566% in under 11 months from $63 per share on January 5, 2024, to a price peak of $420 on November 22, 2024. Meanwhile, $100 spent on an S&P 500 ETF would have returned buyers $27. This suggests that regulated Wall Street investors wanted on to the Bitcoin bandwagon and found a way in Strategy stocks. Seeing the bullishness of corporate finance, Internet crypto markets were now racing Strategy to accumulate a scarce supply of BTC tokens. Now, SharpLink is doing it again with ETH. The company’s stocks spiked over 8 days in late May from $3.76 per share to just under $80 a share as Wall Street rewarded the former gaming company for pivoting to accumulating a regulated corporate Ether treasury.

An Ethereum whale took a $39 million chomp out of the crypto dip on June 22. Ethereum’s forward outlook was too good for this whale not to bite at that 24% off discount tag. Every token is a vote with a daily trading value that fluctuates on a global open market of crypto exchanges. Participants “vote” by locking, unlocking, moving, and swapping currencies, as often as they like, any time they like. When crypto investors take Ether tokens off a crypto exchange, the remaining supply of ETH tends to attract higher prices at the point of sale. But when they stake ETH for yield, it creates even more support.

Not to be outdone by SharpLink, publicly traded, New York-based blockchain company Bit Digital, announced on June 25 it is giving up $34 million worth of BTC tokens to move the proceeds into Ether and develop staking strategies. They might profit well from determining in advance of the overall market which of the Ethereum scale and fee coins will deliver the most yield and gains together over timespans relevant to their balance sheet and calendar.