Ethereum plunged below the critical $2,000 level yesterday, sending shockwaves through the crypto market. The second-largest cryptocurrency hit a low of $1,750 on March 11, marking a staggering 57% decline from its December 2024 peak of $4,100. As of March 12, ETH is struggling to recover, trading in the $1,900-$1,950 range. This marks the third time it’s dipped below $2,000 in 2025 alone. Not exactly the kind of hat trick investors were hoping for.
The crash coincided with Bitcoin’s nosedive below $80,000, triggering a market-wide sell-off. Macroeconomic uncertainty, rising global trade war concerns, and erratic policy decisions from the Trump administration haven’t helped matters. Add in the liquidation of leveraged long positions, and you’ve got a recipe for disaster.
On-chain metrics paint a bleak picture. The MVRV ratio has dropped to 0.93, meaning the market values ETH less than what holders paid for it. Only 50% of ETH holders are currently in profit—the other half? Not so much. A whopping 100,000 ETH moved to exchanges in 48 hours, pushing exchange supply to 9.23 million. Traders are clearly spooked.
On-chain data screams panic as half of ETH holders now underwater and exchange inflows surge dramatically.
Technical indicators suggest the bleeding might stop soon. The RSI has dropped below 30, indicating oversold conditions. A falling wedge pattern is forming on the charts, potentially signaling a reversal. But don’t break out the champagne just yet. A concerning trend shows ETH trading below its realized price of $2,058 for the first time in two years.
Market sentiment remains grim. The decline below psychological barrier has triggered panic selling and exacerbated volatility across cryptocurrency markets. Some investors are seeking refuge in Layer 2 solutions like Polygon MATIC, which offers faster transactions and lower fees during high congestion periods. Analysts are split on what happens next—some predict a further drop to the $1,500-$1,600 range, while others see potential for recovery toward $2,500. Take your pick.
Historically speaking, this is Ethereum‘s worst Q1 performance since 2018. The current downturn bears similarities to the 2016-2017 consolidation period, which eventually led to massive gains.
March has typically been kind to ETH, averaging 20% gains. But with ETH down 31.95% in February and another 15.12% so far in March 2025, history might not repeat itself this time around.
