Ethereum’s price may crash as much as 25% as metrics on the blockchain disappoint

Ethereum has fallen by more than 52% from December’s high. Both technical and on-chain indicators point towards further downside.

EthereumETH() reached a peak of $4,105 on December 20th and traded at $1970 by March 20th. It is one of the most volatile blue-chips in the market, with a 52% drop.

Ether’s price has fallen as worries about its future continue. Only this week. Standard Chartered analysts downgraded The company reduced their revenue estimate from $10,000 down to $4,000 by 60 percent, due to the increased competition between layer-1 networks and layer-2. 

Because of the lower fees, layer-2 Ethereum networks, such as Coinbase Base and Arbitrum have gained more users. You can, for example. DeFi Llama’s data shows The DEX Ethereum protocol handled more than $ 9.8 billion of volume over the past 7 days.

Base had $2.8 Billion, while Arbitrum was responsible for $2.87 Billion. Previously, the Ethereum mainnet would have handled this volume.

Ethereum also faces increased competition from Layer-1 networks such as Solana.SOLBNB Chain. BNB Smart Chain DEX protocols processed DEX volumes totaling over $13 Billion in the past 7 days. 

Ethereum will not be the main beneficiary from emerging technologies, such as Real World Asset tokenization due to its high fees and slow speed. Developers could choose other cheaper and scalable networks such as Mantra.OMBNB Chain and ). 

Ethereum’s metrics on the chain are poor

The number of Ethereum addresses has decreased in recent months, according to new data. Santiment’s graph below shows Ethereum had 461,000 address on Wednesday. That is down significantly from the 717,000 addresses it had earlier this year.

The blue line represents the HODL-wave for Ethereum, which shows its realized cap. The price has dropped to its lowest level since last August, which is a sign long-term investors have begun to sell.

The MDIA or 365-day median dollar invested aged, which is a measure of the amount of time that a coin stays in an account and how much money was used to acquire it, dropped to September’s lowest point.

Ethereum technical analysis

Daily chart indicates that the ETH has had a downward trend for the last few months. The price of ETH began to drop after it formed the triple-top at $4,000 with a neckline of $2,120.

Ether formed a Death Cross pattern when the moving averages of 50 and 200 days crossed. This cross can lead to more negative momentum. Popular oscillators such as the Relative Strength Index (RSI) and Percentage Price Oscillator are also down.

The coin is likely to continue dropping as the sellers aim for the psychological level of $1,500 which is approximately 25% lower than the current price.