Ethereum’s value continues to face downward pressure as the availability of tokens on exchanges increases, inflows into exchange-traded funds (ETFs) stagnate, and its dominance in the decentralized finance (DeFi) arena diminishes.
As of Friday, November 1, Ethereum (ETH) was priced at $2,550, representing a 37% decline from its peak earlier this year. In contrast, Bitcoin (BTC) is currently only 4.7% off its all-time high.
Ethereum encounters multiple hurdles. According to data from CryptoQuant, the volume of tokens held on exchanges has been rising, indicating that some investors are beginning to sell their holdings. Notably, it has been reported that entities such as the Ethereum Foundation and Vitalik Buterin are among those offloading their tokens.
Moreover, interest in spot Ethereum ETFs has been lackluster. Sosovalue reports that total outflows have reached $480 million, while Bitcoin ETFs have attracted over $24 billion in inflows.
In addition, Ethereum has seen its market share in the decentralized exchange sector erode, particularly in favor of Solana (SOL). Recent statistics reveal that Solana’s decentralized exchange platforms, including Raydium and Orca, processed $51 billion in trading volume in October, outpacing Ethereum’s $42 billion.
Looking ahead, Ethereum’s market share may come under additional strain with the upcoming launch of Uniswap’s Unichain, a layer-2 blockchain. Furthermore, Ethereum’s influence in the stablecoin market has diminished to approximately 48%, with competitors like Tron, BNB Smart Chain, Arbitrum, and Base gaining ground. A year prior, Ethereum commanded over 60% of the stablecoin market.
Stablecoins are increasingly vital within the cryptocurrency landscape. For instance, Tether reported a net profit of $2.2 billion in the third quarter, accumulating a total profit of $9 billion over the first nine months of the year. Additionally, stablecoins have gained significant traction in South Korea, becoming essential for cross-border transactions. Countries facing heavy sanctions, including Iran, North Korea, and Russia, have also adopted these digital assets.
As for Ethereum’s price trajectory, it may face a downturn in the near future. Analyst Peter Brandt suggests a potential decline to $1,551, indicating a 40% drop from current levels. The daily price chart illustrates that Ethereum remains below the 50-day moving average and key support at $2,817, which corresponds to the neckline of a double-top pattern with a peak of $3,975.
Moreover, Ethereum has developed a bearish pennant pattern, with the triangle shape nearing a confluence point. This indicates a possible bearish breakout in the upcoming weeks. Should such a scenario unfold, the first critical level to monitor will be $2,117, marking its lowest price from August 5.