ETHZilla (ETHZ) Plunges 3.03% Amid Digital Asset Selloff, FOMC Jitters

ETHZilla (ETHZ) plunged 3.03% on Tuesday, marking its worst intraday performance since its listing, with the share price dropping to a record low amid a 7.58% intra-day selloff. The sharp decline followed a broader market selloff in digital asset equities, with investors rotating out of speculative tech plays ahead of the FOMC meeting later this week.

Analysts noted the move reflected growing caution in the sector as macroeconomic uncertainties persist. Despite a recent rebound in crypto-related stocks, the current pullback suggests investors are reassessing risk exposure in the face of mixed signals from key economic indicators. The lack of catalysts in the short term has left the stock vulnerable to algorithmic selling pressure.

Market participants highlighted that ETHZilla's valuation metrics remain stretched compared to its peers, with the stock trading at a premium to industry averages despite unproven revenue generation. The absence of concrete business developments or strategic partnerships in recent quarters has left the stock without fundamental support to anchor its price action.

Technical indicators show the stock has broken below critical support levels, raising concerns about further downside potential. Short-term traders are now watching the $0.85 level as a key psychological barrier, with a failure to hold above that threshold potentially triggering a cascade of stop-loss orders. The broader market environment will remain crucial in determining the near-term trajectory.