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The price of Ethereum has been finding it difficult to surpass the $2,750 resistance point, although it has risen by more than 44% this month.
At present, multiple indications suggest the altcoin’s trials throughout the 2023-25 phase, which have unveiled both fluctuations and capital flow trends that sharply differ from earlier cycles and rival assets such as Bitcoin and Solana.
Ethereum Encounters Major Obstacles
One of the most significant signs is Ethereum’s realized volatility, which has contracted over cycles as the asset matures, now floating around 80%, a decline from over 120% in past periods, according to Glassnode’s latest analysis.
Usually, Ethereum’s 3-month realized volatility escalates in bullish markets and diminishes in bearish phases. However, this cycle has contradicted that trend. In fact, after attaining 60% at the mid-2024 peak of roughly $4,000, realized volatility unexpectedly surged above 90% even as the price dipped toward $1,500. This unusual spike in volatility amidst falling prices suggests growing market uncertainty and instability.
Furthermore, while the drawdown pattern in this cycle generally corresponds with the standard Ethereum bull market trend – where corrections of 40% or greater from local peaks are typical – the significant divergence lies in the lack of a new all-time high (ATH) price for the altcoin, in contrast to Bitcoin and Solana, both of which achieved new heights during this cycle. This absence of a new peak has disappointed many investors who anticipated the world’s second-largest crypto asset to align more closely with its counterparts.
In addition, Ethereum downward price movements have been unusually erratic, with several drawdowns surpassing 40%, and the current 2025 drawdown reaching an extreme 65.4%. Although earlier cycles have experienced similar or more severe drawdowns, these typically manifested later in the cycle. Thus, this early, sharp correction suggests inherent weaknesses specific to this timeframe.
Regarding capital influx, the Realized Cap – a metric indicating the value of all Ether based on the last transaction price – has risen by only 38% since the cycle low in January 2023, moving from $176 billion to $243 billion.
This is trivial when compared to the tremendous growth during the 2021 cycle, which witnessed over a 1,000% increase. The relatively subdued capital influx of about $67 billion during this cycle highlights weaker liquidity support and helps clarify the crypto asset’s muted pricing performance.
Reinforcing this narrative, trading activity on major centralized exchanges has reflected these trends: spot volume, which peaked at $14.7 billion per day during the $4,000 price pinnacle in December 2024, plummeted by around 80% to $2.9 billion per day. Although recent trading volumes have bounced back to $8.6 billion daily, spot volumes have yet to hit new cycle highs as experienced in previous cycles.
Average ETH ETF Investor Significantly Underwater
The firm’s investigation further indicated that the average investor in the BlackRock and Fidelity Ethereum ETFs is presently facing an unrealized loss of approximately 21%. Net outflows from these ETFs have tended to quicken whenever Ethereum’s spot price dips below the average cost basis, observed during crucial declines in August 2024 and again in January and March 2025.
Despite initial enthusiasm, the ETFs represented only about 1.5% of spot market trade volume at launch, suggesting a lukewarm welcome. While this rose to over 2.5% in November 2024, it has since reverted back to 1.5%.
While current market conditions indicate growing pressure for the crypto asset, certain market analysts also foresee that it could reach the $3,000 milestone as soon as June.
The post Increasing Evidence of Ethereum’s Struggles: Volatility, ETF Losses, Weak Demand appeared first on CryptoPotato.
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