Ethereum’s price has been falling for weeks, and it shows no signs of stopping. After three straight weeks of losses, Ethereum is now trading at its lowest point against Bitcoin since January 2020. The ETH/BTC pair has dropped to 0.019, which is more than 80% below the peak it reached in December 2021. Ethereum’s price in U.S. dollars has also declined sharply. In 2023, ETH traded as high as $4,000, but it has since fallen below $1,500. This drop has hurt Ethereum’s dominance in the crypto market. In 2021, Ethereum held a much larger share of the market. Now, its dominance has fallen by 67% and is getting close to 2022 levels.
A key reason for Ethereum’s price drop is the transition it made in 2022. This change, called The Merge, moved Ethereum from proof-of-work to proof-of-stake. The goal was to make Ethereum faster, cheaper, and more energy-efficient. Many thought this change would help Ethereum grow. But since The Merge, Ethereum has struggled. It faces more competition from other blockchains like Solana and Avalanche. These networks are known for faster speeds and lower fees. Investors looking for better performance and lower costs have started moving their funds to these networks.
Ethereum is also facing tough competition from within its own ecosystem. Layer-2 networks built on Ethereum, such as Base, Arbitrum, Optimism, and Polygon, now handle a large share of the activity. Over the past 30 days, decentralized exchanges built on Ethereum have seen $57.9 billion in trading volume. In that same time, Ethereum’s layer-2 networks processed more than $35 billion. These networks are meant to help Ethereum scale, but they also pull attention and money away from the main Ethereum chain.
Another issue is that Ethereum is not earning as much from fees as it used to. In 2024, blockchains like Tron, Solana, and Jito have made more fee revenue than Ethereum. This matters because fees are a big part of how the network stays strong. If people are not paying to use Ethereum, it means there is less demand. Lower demand usually leads to a lower price.
Ethereum’s price chart shows a clear downtrend. Technical analysis gives more clues. One major pattern on the weekly chart is called an inverse cup and handle. This pattern often shows up when an asset is about to drop even more. It looks like a rounded top followed by a short period of sideways trading. After this, the price usually falls. Traders see this pattern as a bearish signal, and it’s now showing up clearly on Ethereum’s chart.
Another warning sign is the death cross. A death cross happens when the 50-week moving average drops below the 200-week moving average. This happened for Ethereum in May last year. When these two lines cross like this, it often means the market is in a long-term downtrend. Since then, the price has kept falling. The Average Directional Index, a tool that measures how strong a trend is, has gone up to 44. A reading above 25 usually means a strong trend. A reading of 44 means that the current downward move is gaining strength.
Ethereum is also struggling to attract big investors. Spot Ethereum ETFs launched recently but have not brought in much money. So far, these ETFs have collected under $2.6 billion. In total, they hold only $4.9 billion in assets. That’s small compared to the $85 billion invested in Ethereum funds overall. Investors seem more interested in Bitcoin ETFs, which have seen much stronger inflows. Many see Bitcoin as a better store of value, especially during uncertain times.
With so many challenges, some analysts believe Ethereum could fall even more. Based on the size of the inverse cup and handle pattern, technical projections show that Ethereum could drop to 0.0025 in the ETH/BTC pair. That would bring it close to its all-time low. While that may not happen right away, the signs all point to further downside for Ethereum.
Ethereum has always been a major force in the crypto world. It introduced smart contracts and made DeFi and NFTs possible. But the crypto world moves fast, and now Ethereum must compete not just with Bitcoin but also with a growing number of fast and cheap blockchains. Some of these networks are attracting developers and users who used to build on Ethereum.
The rise of layer-2 networks was meant to help Ethereum grow. These networks process transactions faster and with lower fees. But they also reduce the need to use the Ethereum mainnet. This means less activity and fewer fees for Ethereum itself. If this trend continues, Ethereum could become less central to the crypto ecosystem.
Ethereum’s performance against Bitcoin is one of the clearest signs of its struggles. ETH/BTC is now near its lowest level in more than four years. A weak ETH/BTC pair means that Ethereum is losing ground to Bitcoin in the eyes of investors. Many prefer Bitcoin’s fixed supply and simpler design. While Ethereum has more features, it also comes with more complexity and competition.
For anyone watching Ethereum’s price, it’s important to keep an eye on these patterns. The inverse cup and handle is a strong bearish sign. The death cross adds more weight to the bearish case. And the rising Average Directional Index confirms that the downtrend is real. Ethereum may still have a future, but for now, the charts suggest that the price could go even lower.
Traders and crypto fans should also watch how Ethereum responds to its competitors. If Solana, Avalanche, or Tron keep growing, they could pull even more users and money away from Ethereum. That would add more pressure to the price. Also, if Ethereum doesn’t find a way to bring in more fee revenue or attract new users, the problems could get worse.
Ethereum has been through ups and downs before. It could recover, especially if it finds new ways to grow or if crypto markets turn around. But right now, the data shows a clear trend. The price is falling. The signals from the charts are bearish. And Ethereum faces strong competition from both inside and outside its network.
The crypto market is always changing. Ethereum helped shape what crypto looks like today. But no project can stay on top without solving real problems. Ethereum still has a strong team and a large developer base. But it needs to show that it can keep up with the demands of users and compete with faster and cheaper chains. Until then, Ethereum’s price may continue to slide.
