Ethereum Price Plummets Amidst Bybit Hack Fallout, Bulls Eye $2.5K
1min read Market funding rates have plummeted following the recent Bybit hack, which resulted in a loss of over $1.4 billion. This decline in funding rates comes amidst low market sentiments and creeping interest from bulls and large holders. However, there are signs of renewed growth, as Ethereum (ETH) reserves on the exchange have recovered, and crypto users remain optimistic despite the mounting fears over the weekend.
In the past 48 hours, funding rates have significantly impacted altcoin price trends, leaving traders at a crossroads. On one hand, a sharp decline in funding rates has placed the asset below its previous support level, on its way to the $2,500 line. This downward movement has wiped out slight gains, as altcoins set course for a possible recovery. At the time of writing, ETH price stands at $2,676, a 4% drop in the last 24 hours, with weekly gains also plummeting as sell pressure spiked.
CryptoQuant has noted that the sharp decline in funding rates suggests heightened selling pressure and fear-driven activity in response to the hack. If this trend persists, particularly with continued resistance at the $3K level, further declines could follow, with sellers eyeing $2.5K as the next major support. However, a trend reversal could spur Ethereum price above the $3k mark, setting the tone for larger gains. Funding rates are crucial in gauging the market's direction due to the urgency of trade execution.
On the flipside, Ethereum holders maintain a solid position for a price leap, citing institutional and on-chain factors. The asset reserve on Bybit recorded over 400% increase after the Bybit incident, with recent charts showing over 200,000 ETH as trading activities rebound. While movement to exchanges is generally a bear signal, most previous outflows were sales and not to other custodians. With trust increasing, whales also made huge purchases, looking to gain as the market swung upwards. Ethereum is expected to be at the fore of the altcoin season, which market experts deem to have kicked off, fueling price projections above $4k before the cycle top.
