Ethereum's Ether Drops 15% Below $2,000, TVL Hits Six-Month Low

Ethereum’s native token, Ether (ETH), has experienced a significant decline, dropping below the $2,000 mark on March 10. Despite minor recoveries observed in Bitcoin (BTC) and XRP (XRP) over the past 24 hours, Ether has struggled to regain its position above the psychological level of $2,000. The altcoin plummeted to a multi-year low of $1,752 on March 11, raising concerns about its future trajectory. Onchain data and technical analysis suggest that the price could drop an additional 15% in the coming weeks, potentially reaching a bottom around $1,600.

The current price deviation below $2,000 has significant onchain implications for Ethereum. According to a data analytics platform, ETH dropped below its realized price of $2,054 for the first time since February 2023. The realized price calculates the average price of each ETH last moved, representing the average cost basis of the total circulating supply. The current drop below the realized price indicates widespread unrealized loss for all ETH holders. The market value to realized value (MVRV) ratio also dropped to 0.93, indicating a 7% average loss for all ETH holders across the network. However, it is important to note that the realized price reflects the weighted average of all historical transactions, encompassing the cost basis of every ETH holder, not a specific timeframe.

Ethereum’s total value locked (TVL) dropped to a six-month low of $45.6 billion on March 12, down 41% from its peak of $77 billion on Dec. 17, 2024. Additionally, the total fees users paid to use Ethereum fell to $46.28 million—the lowest level since July 2020—further signaling weakening network engagement. These indicators suggest a broader decline in the network's activity and value, which could contribute to the downward pressure on Ether's price.

In a recent post, a data analytics platform explained how Ethereum’s cost-basis distribution could be useful in identifying potential support levels for ETH. Based on a weekly outlook, Ether’s recent drop below $1,880 led to an accumulation of 600,000-700,000 ETH around $1,900. This suggests that $1,900 could establish itself as a support level if ETH consolidates at current levels. Above the spot, $2,200 (465K ETH) is the potential next resistance. The supply gap between $1,900 and $2,200 remains thin, making a short-term move towards resistance plausible. An anonymous analyst believes that the floor price for Ethereum remains between $1,600 and $1,900, describing this range as an “attractive region for commercial money” and setting a high swing target at $2,500.

While the current market conditions are challenging for Ethereum, the potential support levels identified by analysts and the historical data on realized prices provide some insights into where the price might bottom out. The $1,600 to $1,900 range appears to be a critical area for ETH, with $1,900 serving as a potential support level and $1,600 as a possible floor price. However, the market remains volatile, and further declines cannot be ruled out. Investors and traders should conduct their own research and consider the risks involved before making any decisions.