Ethereum (ETH) price is currently experiencing its most challenging week since April 2025. The popular altcoin saw a significant drop of over 11% on Tuesday, hitting a daily low of around $3,060 before recovering to trade at approximately $3,206 at the time of writing.
This decline in Ether’s price had a ripple effect on the broader altcoin market, leading to substantial losses. The leveraged crypto market suffered losses of $2 billion, with long traders accounting for over $1.63 billion of the total.
Reasons Behind Ethereum’s Price Drop Today
Impact of Macro Fears and Bitcoin’s Decline
The cryptocurrency market experienced significant losses on Tuesday amidst macroeconomic concerns. The U.S. stock market alone lost over $700 billion in value, while the wider crypto market saw a decrease of over $300 billion.
Following Bitcoin’s drop below $100k for the first time since June, Ethereum’s price also declined in tandem. However, the market quickly rebounded, driven by the “buy-the-dip” narrative.
Impact of Heavy Liquidation on Long Traders
The ETH/USD pair experienced a significant drop on Tuesday largely due to the heavy liquidation of long traders. According to data from CoinGlass, more than $655 million was lost in leveraged ETH trades, with long traders accounting for over $576 million of the total.
This led to an exaggerated long squeeze effect, contributing to the notable selloff in Ethereum’s price during the day.
What’s Next for Ethereum?
Following the recent price decline, traders on Kalshi believe there is an 82% chance that Ethereum’s price will drop below $3k in 2025.
Source: X
However, market analyst Danny Marques is optimistic about a bullish rebound for the ETH/USD pair, expecting a new all-time high in the coming weeks.
