Key Takeaways:
- ETH briefly plummeted to $1,993** on Binance before recovering to **$2,050.
- The drop marks ETH’s lowest price since April 2023, dampening hopes of a sustained recovery.
- Weak altcoin sentiment and macroeconomic pressures contributed to the decline.
ETH’s Price Plunge: What Happened?
According to Binance trading data, Ethereum (ETH) hit a low of $1,993**—its weakest level since April 2023—before rebounding to **$2,050. Despite expectations of a strong Q1 performance, ETH has re-entered bearish territory.
👉 Why Ethereum’s crash matters for crypto investors
Market Context
- ETH’s drop mirrored broader cryptocurrency market declines, with altcoins underperforming.
- The token’s value against BTC fell to 0.025 BTC, delaying a potential breakout.
- Macroeconomic factors, including new trade tariffs and stock market volatility, exacerbated the sell-off.
Key Factors Behind ETH’s Decline
1. Weak Altcoin Sentiment
The Altcoin Season Index slid to 22 points (out of 100), indicating bearish conditions. While it later recovered to 24, most altcoins—including ETH—faced deep corrections.
2. Declining Open Interest
ETH’s open interest dropped to $9.8B** (from **$16B+ in December 2025), reflecting reduced trader confidence. Long-term holders now dominate positions (74% long).
3. Liquidity and Whale Activity
- Whales accumulated ETH during the dip, with some purchasing $10M+ worth.
- Bybit’s hacker incident added selling pressure (500K ETH liquidated in days).
"Even smart money got trapped in this crash. Whales are now averaging down their positions."
— Market Prophet (@marvetProphit), March 4, 2025
FAQ: Ethereum’s Crash Explained
Q1: Will ETH recover above $2,000?
While ETH rebounded past $2,000, sustained recovery depends on market sentiment and whale accumulation.
Q2: What’s the impact on DeFi?
Lower ETH prices reduce Ethereum chain activity, raising doubts about its utility for DeFi protocols.
Q3: Are whales still buying ETH?
Yes. Large investors are leveraging the dip to cover loans or reposition for long-term gains.
Conclusion
ETH’s crash underscores crypto market volatility and the need for cautious trading. While accumulation by whales suggests potential recovery, short-term risks remain high.