Foreign media analysis suggests that Ethereum's recent weakness is not simply a matter of price decline. ETH has fallen below the holding cost range of some whales, weakening the support the market previously relied on from large investors. Furthermore, DeFi lending and liquidation have amplified the downward pressure.
Falling below the cost range of major investors
The report noted that the price of ETH once fell back to around $1,740, below the whale realization price of around $1,900. This means that many large holders have turned from unrealized profits to unrealized losses.
Meanwhile, ETH is also below its long-term AVWAP level since its launch on Binance, which is currently around $1700. The article states that in the past six years, ETH has only fallen below this long-term benchmark four times, and these periods are typically accompanied by weakening market confidence and a decline in buying interest.
DeFi liquidation continues to exert pressure
The article argues that after ETH fell below $1,550, the market exposed the high leverage problem in DeFi lending. As collateral hit the liquidation threshold, more than 21,540 ETH were liquidated, estimated in the article to be worth approximately $34.1 million.
This kind of chain reaction can accelerate the decline: falling prices trigger liquidations, which in turn bring in new selling pressure. The article also mentions that approximately $547 million in leveraged positions remain in risk territory on Aave and Maker. If buying pressure can hold above these price levels, liquidation pressure may ease; otherwise, ETH volatility is likely to remain high.
Low-level buying is still insufficient to reverse the trend.
From the perspective of the spot market, the article states that some retail investors actively bought in the $1,550 to $1,600 range, but larger holders continued to sell, making it difficult for new demand to fully absorb market supply.
The article also mentions that although there have been periods of increased active buying, the overall buying strength is still insufficient to sustainably suppress the selling pressure from whales and liquidations. Exchange flows also reflect a similar situation: some ETH has been transferred out of exchanges, indicating that some investors are turning to self-custody, but intermittent inflows continue to replenish the sources of selling pressure on exchanges.
The article argues that the current market is in a fragile balance. Buying has temporarily prevented a deeper decline, but it hasn't yet formed a strong enough reversal force. Until spot demand significantly strengthens, ETH will face difficulties in achieving stable stabilization.
