Ethereum continues to strive for the $1,900 mark as it faces declining DeFi metrics and intensifying competition affecting its price.
Data from DefiLlama shows that the total value locked in the Ethereum network plummeted from $63 billion in January to $44 billion in February, indicating reduced liquidity and a decline in investor participation. Furthermore, the influx of stablecoins has waned, signaling a slower capital flow into Ethereum (ETH) protocols.
Decentralized exchange trading volumes have hit a downturn, decreasing from $92 billion in December to $82 billion in February. In contrast, platforms like Hyperliquid (HYPE) and Solana (SOL) are witnessing a rise in perpetual futures trading, whereas Ethereum’s futures trading has fallen from $31 billion in December to $18 billion in February.
Revenue generated by Ethereum has sharply declined, nosediving from $193 million in December to just $26 million in February, attributed to reduced transaction fees and a slowdown in network activity.
Moreover, data from SoSoValue indicates that spot Ether ETFs have recorded withdrawals for four weeks straight, totaling $176 million over the past month, suggesting a fading institutional interest in Ethereum.
At present, Ethereum is trading at $1,876, struggling to maintain a crucial support level of $1,875. With ETH consistently trading below its 50-day moving average of $2,282.50, the daily chart reveals a clear downward trend, reinforcing the bearish outlook.
Bollinger Bands show increased volatility, with Ethereum hovering close to the lower band, indicating possible oversold conditions. The relative strength index is at 34.51, nearing the oversold threshold of 30, which indicates weak buying momentum, although there remains a potential for a relief rally if demand picks up.
Low trading volume suggests minimal market engagement. If ETH drops below $1,875, it could target $1,800; on the other hand, a recovery would face resistance at $2,282. For a bullish reversal, Ethereum must reclaim its 50-day moving average, although price dynamics remain pressured.
A key development to watch is the push to include staking in Ether ETFs. Cboe BZX has put forth a proposal to U.S. regulators for staking in Fidelity’s Ether ETF, following a similar inquiry from 21Shares in February. Should this proposal receive approval, investors might earn about 3.3% in staking rewards, potentially attracting more institutional interest.
