In the last few days, the price of Ethereum has dropped to just over $2,300.
This is a decline that already started at the end of September and is continuing in these first days of October.
The decline in the price of Ethereum (ETH): is there still room for a drop?
On September 27, the price of ETH was about $2,700.
Even then it was not a particularly high price, given that the all-time high is the nearly $4,900 of November 2021, and the 2024 high reached about $4,100 in March, but afterwards it fell further.
Moreover, on August 24th, it even managed to get back to $2,800, so it has been appearing a bit under pressure for several weeks.
It should not be forgotten, however, that at the beginning of September it had dropped to below $2,200, only to recover apparently well in the second half of the month. Evidently, that recovery was not enough.
Already on September 30, it had dropped to $2,600, and that decline that started then seems to actually still be ongoing.
At this point, it is not unreasonable to imagine that it could continue further, especially since the September lows are not far away.
The causes of the recent drop in the price of Ethereum (ETH)
Behind the decline of the last few days, there is certainly an increase in selling pressure.
It is important to highlight how the current selling pressure is perfectly in line with that of the last month, and is still significantly lower than that of August.
This leads to the belief that there are two trends in place, perhaps slightly different, one in the short term and one in the medium/long term.
It should be noted that the price of Bitcoin is also down, and it is probably this that is negatively affecting the entire crypto market today.
However, this only applies to the short-term trend, while the medium/short-term trend could also be influenced by another factor.
The large sales
Although in the medium/short term, the selling pressure on ETH does not seem to be particularly increasing, for some time now there have been some specific sales that may have triggered some decline.
In particular, there is a whale that had purchased ETH during its ICO in 2014, which has been continuously selling Ethereum for two weeks.
This whale received as much as 150,000 ETH in 2014, and is now selling many in blocks of tens of thousands at a time.
This #Ethereum ICO participant sold another 19,000 $ETH($47.54M) in the past 2 days!
The participant received 150K $ETH(ICO cost was $46.5K, now worth $358M) at #GENESIS.https://t.co/WbaTNzh5T4 pic.twitter.com/p82RcPRYMd
— Lookonchain (@lookonchain) October 3, 2024
For example, at the end of September, he sold 12,000, while in the last two days he sold another 19,000.
If such a whale sells such significant quantities of Ethereum (several tens of millions of dollars), it could mean that it fears a bull of its value.
This is inevitably generating fear, and this increases the selling pressure.
The competition
The strange thing is that theoretically in the second half of October a new bullrun could start.
Therefore, it is possible to imagine that that whale is convinced of the opposite, and that it is liquidating enormous quantities of ETH at this moment, after a decade of pure holding, because it believes that its value could instead fall further, and perhaps by a lot.
In theory, there could also be a logical explanation for this reasoning.
In fact, until 2023 it was very difficult to imagine that there was any chain truly alternative to Ethereum capable of competing with it.
Instead, lately, the possibility that there is some serious competitor is emerging more and more, primarily Solana.
To tell the truth, in past years BSC (Binance Smart Chain) tried, but it was a flash in the pan, because the real competition lasted only a few months.
As for Solana, there is a risk that it is not just a flash in the pan, also because this ecosystem has been growing a lot for many months now.
Furthermore, there is also TON that is slowly emerging as a potential future competitor, so Ethereum might not remain the absolute leading chain, for example in DeFi for much longer.
The bull run
If all this turns out to be true, even in the case of a bull run Ethereum might suffer a bit.
For example, it is not impossible to imagine that the whale selling ETH might be buying SOL, or other alternative cryptos to Ethereum.
Just consider that the price of SUI has increased by 10% in the last seven days, despite yesterday’s drop, and by 130% in the last month.
So the key point might also be another, namely the fact that there are cryptos that could outperform Ethereum during a potential new bull run.
In light of this, some ETH holders might decide to reposition themselves, perhaps even partially, into other crypto, to diversify and to try to seize better opportunities.
Although it is by no means certain that this is actually happening, it is true that after a decade of absolute dominance in the field of decentralized finance, Ethereum is now beginning to face real potential competitors.
In reality, Ethereum still dominates the DeFi unchallenged, but those who think in the long term may have already glimpsed the beginning of a new trend. After all, those who bought ETH in the ICO in 2014 and held it for 10 years are certainly primarily focused on long-term trends.
