Ethereum Recovers 6.2% After 5-Month Rollercoaster

Ethereum's price experienced a significant downturn in April, dropping to as low as $1,470 due to a wave of liquidations and geopolitical pressures. Throughout the year, trade policy shifts have triggered sharp swings across the crypto market. However, Ethereum has since recovered, now trading just below $3,000 after a five-month long period.

Eric Trump, the son of former U.S. President Donald Trump, tweeted in February that it was a great time to add Ethereum to one's portfolio. Following his advice, investors who bought Ethereum at that time have finally seen their investments turn profitable. From February 4, when Trump made the call, to July 9, Ethereum has endured a rollercoaster run, experiencing significant declines throughout March and April, bottoming out near $1,500.

Despite the initial drop, Ethereum has since recovered. If an investor had followed Trump's advice, their investment would be up by around 2.9%, estimated between the $2,870 level at the time of Trump’s tweet and the price of $2,962 on July 9. Price swings began a day before Trump's tweet, when Ethereum dropped nearly 18% to $2,544 amid a frenzy of liquidations triggered by a significant wipeout of overleveraged long positions. This drop was compounded by rising macroeconomic uncertainty stemming from President Donald Trump’s tariffs, as well as broader concerns about inflation and central bank jitters.

Roughly 24 hours later, Donald Trump announced a temporary pause on proposed tariffs against Canada, triggering a short-lived resurgence. The market interpreted the move as a sign of easing trade tensions, which helped fuel a double-digit rally across other major cryptos. However, the broader downtrend continued well into March, with analysts calling it a “miserable run.” The markets needed “a circuit breaker on sentiment.”

By the first week of April, tariffs imposed on China by Eric’s dad had taken effect, triggering a broader global tariff shakeout that sent Ethereum, along with Bitcoin and other crypto assets, into weeks of intense volatility. May brought in a powerful reversal, with Ethereum surging back above $2,700 as buyers returned with fresh enthusiasm after the Pectra Upgrade. Yet a month after, Ethereum’s price remained stuck near $2,800, roughly flat compared to pre-upgrade levels, despite the significance of the rollout. While the upgrade improved functionality, it did not spark a breakout and network activity remained subdued.

By late June, Ethereum had stabilized to a healthier position than its April lows, though it remained below its February peaks. It was the first time since Trump’s tweet that Ethereum broke and held above the level. At the time of writing, Ethereum is closing in on the $3,000 level, having gained 6.2% on the day, mainly driven by momentum from Bitcoin’s latest breakout to a new all-time high.

The recovery of Ethereum's price is a testament to the volatility and unpredictability of the cryptocurrency market. While Eric Trump's endorsement may have contributed to the initial surge in Ethereum's price, the subsequent market downturn highlighted the risks associated with investing in digital currencies. However, the recent price recovery has provided a glimmer of hope for investors who weathered the storm and held onto their Ethereum investments.

The Ethereum network has also undergone significant developments, which have contributed to its price recovery. The network's transition to a proof-of-stake consensus mechanism, known as Ethereum 2.0, has been a major milestone. This upgrade aims to improve the network's scalability, security, and sustainability, making it more attractive to investors and users alike. Additionally, the growing ecosystem of decentralized applications (dApps) built on the Ethereum network has further fueled its adoption and price appreciation.