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The drop in the price of Ethereum (ETH) below $2,000 has put crypto-based investment funds in the US in a very painful situation. According to new data, the group of funds is now grappling with more than $5 billion in unrealized losses. Bloomberg senior analyst James Seyfarth estimates that the average purchase price for Ethereum ETF holders is around $3,500. At current prices, this means their portfolios have lost an average of 44%; A much worse situation for Bitcoin investors.
Tom Lee, the head of Bitmine, has tried to bring some peace back to the market with a historical perspective. He reminds that in the last 8 years, Ethereum has experienced 7 times drops above 60% and has returned to the upward trend every time. Of course, the main question is: Will the new ETF investors who are used to the traditional markets have the patience of the old crypto holders?
Technically, Ethereum is at a critical juncture. The price remains below 2 thousand dollars and the selling pressure is still high. If capital outflows from ETFs continue, there is a possibility that ETH will fall to the $1,800 range. Breaking this range can also cause a sharper fall. Meanwhile, the $3,500 range has now become a psychological wall. If Ethereum ever returns to this price, it will likely face heavy selling pressure as many investors just want to dump their money and exit the market.
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