Ethereum Social Sentiment Dips as Price Nears Previous Bull Run Levels

Ethereum’s social media sentiment has dropped to levels reminiscent of the period before its 2025 price rally, when it eventually returned to its 2021 all-time highs. This observation comes from Santiment analyst Brian Quinlivan, who highlighted the pattern in a recent video. Despite the drop in sentiment, Quinlivan argues it might indicate a potential upward move for ETH.

In early 2025, Ethereum's price surged from a low of $1,472 to $4,878 over four months. Quinlivan noted that ETH had taken off 'just as people were really starting to write-off Ethereum.' This historical context supports the possibility of a similar price movement in 2026.

However, Ethereum has since declined from its 2025 all-time high of $4,878 to $3,089 at the time of publication. A significant liquidation event on October 10 pushed the broader market into a downtrend. In the past 30 days, ETH has dropped 4.64%.

What Are Analysts Watching Next

Analysts remain cautious, noting that while social sentiment has surged in early 2026, the broader Fear & Greed Index continues to hover in the lower zones. This suggests that while retail engagement is increasing, caution remains among investors.

Santiment analyst Brian Quinlivan cited the post-holiday rebound in social engagement as a positive sign, indicating a growing interest in Ethereum and Bitcoin. Nonetheless, he cautioned that enthusiasm on social media does not always translate to price gains. In fact, high FOMO sentiment has at times preceded market slumps.

Why Did This Happen

Ethereum's current price of $3,113 is struggling to break the key $3,300 resistance level. This is partly due to a bearish divergence in on-chain demand, particularly as seen in the Coinbase Premium Gap. This metric has fallen to -2.285, the lowest level since early 2025, signaling weaker institutional demand.

CryptoOnchain analysts have noted that sustained Ethereum rallies have historically coincided with a positive premium on Coinbase. The current negative gap implies that institutional buyers are staying on the sidelines. Until demand returns to positive territory, a breakout above $3,300 is unlikely.

In addition, Ethereum spot ETFs recorded a significant outflow of $1.42 billion in November, highlighting the slow demand in the U.S. market.

How Did Markets Respond

Grayscale's Ethereum Staking ETF (ETHE) made history by becoming the first U.S.-listed spot Ethereum ETP to distribute staking rewards to investors. On January 6, 2026, ETHE shareholders received $0.083178 per share, based on staking income earned between October 6 and December 31, 2025 according to reports.

This move marks a significant step in the integration of digital assets into mainstream finance. Grayscale CEO Peter Mintzberg described it as a landmark moment for both the Ethereum community and ETPs. The ETHE fund has reinforced Grayscale's leadership in the evolving crypto ETF landscape.

The broader market has also seen a shift in investor positioning. While Bitcoin leads with a 6% year-to-date gain, Ethereum is attracting attention as a key second-tier asset. On-chain data indicates a whale accumulation phase, suggesting that investors are diversifying their portfolios beyond Bitcoin.

Ethereum’s price movement remains closely tied to its social and on-chain fundamentals. Analysts continue to monitor sentiment shifts, institutional demand, and key resistance levels as potential indicators of future price direction.