Key Insights
- Ethereum drops as global economic weakness and risk-off sentiment reduce investor confidence and market momentum.
- On-chain metrics show slowdown, with TVL falling 24% and DApp activity dropping 18% in October.
- Institutional interest remains low, while ETF outflows and liquidity zones near $3,200–$3,350 guide price support.
Ethereum dropped 12% in the past week despite briefly rising above $3,400. Weak global economic signals and market caution are pressuring Ethereum. Analysts are watching key liquidity zones between $3,200 and $3,350 as potential support before another rally.
Ethereum Macro Factors and Market Sentiment
Global economic conditions are weighing on Ethereum and the broader crypto market. Weak earnings from consumer companies and high AI valuations increased risk-off sentiment. The ongoing U.S. government shutdown adds pressure. A University of Michigan survey shows consumer sentiment at the lowest level since 1978. These conditions have contributed to a decline in investor confidence.
Trading activity on Ethereum has slowed. Volume dropped by over 31% to $65.3 billion. Open interest also decreased slightly to around $38.85 billion. Funding rates remain low at 0.0073%, signaling limited bullish leverage in the market.
Ethereum On-Chain Metrics and DeFi Activity
Ethereum’s ecosystem shows cooling signs as DeFi activity decreases. Total value locked on the network fell to $74.256 billion, down 24% in 30 days. A recent attack on Balancer v2 resulted in a $120 million loss, further affecting confidence.
Decentralized application usage dropped to $80.7 million in October, 18% lower than September. Reduced on-chain activity may slow staking rewards and affect network performance. Analysts note that Ethereum’s price movement is tied closely to these metrics.
ETF Demand and Institutional Flows
Ethereum spot ETFs are experiencing limited interest from investors. U.S.-listed products saw net outflows of $507.83 million in November. Institutional buying remains weak, with no major corporate treasuries increasing holdings.
Cathie Wood’s Ark Invest recently bought 240,507 shares of BitMine, an Ethereum treasury firm. This provides indirect exposure to Ethereum but has not yet influenced ETH price highly. Analyst Lennaert Snyder warns that a failure of the $3,200 support level could drive Ethereum toward $3,000. A bounce to $3,400 may create a short-term rally to $3,650.
https://x.com/ArkkDaily/status/1986614784960209225?s=20
The upcoming Fusaka Upgrade in early December may improve Ethereum’s scalability and security. A sustained price rally may require improved macro conditions, ETF flows, and stronger on-chain activity. Currently, Ethereum remains under pressure from economic uncertainty, lower trading volumes, and weak institutional appetite.
