Ethereum Struggles Below 1600 as Market Uncertainty Continues

Ethereum, the second-largest cryptocurrency in terms of market capitalization, is having a tough time maintaining recovery momentum in the early part of April 2025. At this time, the price of ETH is $1,589.46, having increased by only 2.99% in the last 24 hours, but it is still in a bearish market state after the whole first quarter turned out that way.

For the first quarter of 2025, the cryptocurrency fell by around 45%, equivalent to $170 billion market value, and ended up being one of the worst quarterly performances for Ethereum since 2016 when it was losing more than in recent times, mainly due to other market issues and shares of investors in the digital asset industry.

Within 24 hours, the trading volume went up to $40.88 billion, showing an increase of 38.34%, representing 22.11% of the total market cap. This increased trading suggests that the traders’ volatility is in line with their expectations of the uncertain market conditions.

The market cap has currently reached $191.81 billion of which the fully diluted valuation is also $191.85 billion. And with 120.67 million ETH as the circulating supply and without the highest supply cap, the inflationary element will keep on dragging the long-term price expectations despite the recent modification on the token’s economy where the concerns have been reduced.

During the significant downturn in the market, the cryptocurrency briefly fell below the crucial support marked by $1,500 on April 7, reaching its lowest position since the end of 2023. This fall was parallel with the turbulence in the market, which resulted in a loss of nearly $890 million in the liquidation of crypto in a single day.

Asian share markets were also among the biggest losers during this time, proving the increasing connection between traditional financial markets and cryptocurrencies. According to some experts, cryptos are usually used as a risk sentiment indicator that precedes the reactions of traditional markets.

The technical indicators for Ethereum give a few reasons to worry about the currency in the short term. The cryptocurrency is trading consistently below its 100-hour Moving Average since its up-trend line was broken and support at $1,865 was the key to the bullish trend, it also indicates selling pressure can be continued.

It is not only negative news about Ethereum. It has been made known through various channels that the developers of Ethereum have decided to officially roll out the Pectra upgrade till the 7th of May, 2023 that will become the most significant update of the blockchain since the month of March in the year 2024. This gamut of new features will definitely attract players back to the realm of DeFi.

The 11 upgrades of the Pectra implementation involve three key areas: staking experience improvement, wallet feature addition, and network infrastructure upgrade. A significant increase, which will not only make one able to stake 2,048 ETH but also bring relief to the people divided across multiple miners with 32 ETH, will be one new feature.

Even with price headwinds, Ethereum did something impressive in March when it succeeded in overtaking other trading pairs and reaching the top position in the DEX trading volume for the first time since September 2024. Based on data from Ethereum, more decentralized exchanges (DEXs) traded $64 billion in spot trading than did Solana and BSC.

The Ethereum network has a total stablecoin lock-up of almost $124.5 billion, while the DeFi sector of Ethereum has a locked value of up to $49 billion, making it the leader. These figures show that people do not stop using the system even when the price is moving up and down.

The Ethereum network’s burn rate has dropped to the lowest since August 2021, and the data shows that only 53 ETH was burned per day last week. This led to the total supply of Ethereum increasing by almost 3% since the launch of the EIP-1559 upgrade.

There was a decrease in the level of institutional interest in Ethereum due to recent weeks, as Ethereum exchange-traded funds had a withdrawal of $403 million in March only. This careful attitude of institutional investors is likely associated with the broader uncertainty of the near term price of Ethreum prospects.

Analysts at Standard Chartered have revised their end-of-year ETH price forecast downward from $10,000 to $4,000, as they associated the situation with the active competition from the layer-2 scaling solutions of Ethereum, which have gathered those customers striving for lower transaction fees. The network activity metrics further point to these challenges as a minimal fee of generation from $142 million in January has plummeted to just $21 million in March.

For those who are looking to get into the market and are thinking of the right time to do so, if the $1,500 threshold is maintained, Ethereum could be pushed toward the psychological barrier of $2,000. In case the market sentiment improves, some analysts are even pointing out that the token could reach as high as $2,200 within a few short weeks.

Conversely, in the event that the bearish pressure maintains its dominance, Ethereum could make a downward move and test the support at $1,400 and even go further to aim for the lowest price in several months, which is around $1,000. The nearest resistance Ethereum could face is at $1,850 and $1,920; a break over the latter may even lead to a rally toward $2,000.

When considering the future, Ethereum’s long-term potential certainly has a significant market opportunity in spite of some present market difficulties. The network continues to be the leader in real-world tokenization of assets, having 54% of the tokenized assets market and $5 billion worth of tokens in its possession. The RWA sector is expected to multiply by eight (from $2 trillion to $16 trillion) til 2030.

With the probable change in the Federal Reserve’s monetary policy in the future and a reduction in some macroeconomic doubts, Ethereum may be growing and started again. The newly anticipated Pectra update, together with the already built-up and the ongoing development of Ethereum’s ecosystem, gives a good base for cautionally optimistic feelings in contrast to the present pessimistic market.

Ethereum’s immediate price predictions are still erring on the side of caution according to both professional traders and retail investors, as the derivatives data exhibit. The cryptocurrency’s next steps are likely to be influenced by the general market situation, the reactions of the authorities to the regulation issue, and the proper implementation of the technical roadmap.