The cryptocurrency market continued to experience severe fluctuations in the first quarter of 2025, and the price trend of Ethereum (ETH) has become the recent focus. Since hitting an all-time high of $4,100 on December 16, 2024, the price of ETH has plummeted by more than 52% in three months, hovering around $1,916 as of mid-March. However, analysts warned that if ETH falls further below the key support level of $1,900, the market may usher in a new round of panic selling, but at the same time this may also become an opportunity for long-term investors to buy at the bottom. It is worth noting that Bitcoin prices have also been under pressure recently. Whether it can maintain its key price before the Federal Reserve’s policy meeting may indirectly affect Ethereum’s market sentiment.
According to Juan Pellicer, a senior researcher at on-chain analytics firm IntoTheBlock, Ethereum has a “historically robust demand zone” between 1,848and1,905. Data shows that approximately 4.3 million ETH were purchased within this price range, forming significant support. Pellicer told Cointelegraph, “If ETH breaks below this zone, we could see capitulation-style selling, but this would also indicate that bearish momentum is waning, laying the groundwork for a rebound.” He also emphasized that if Bitcoin prices can close above $81,000 on a weekly basis, it could inject confidence into the broader crypto market. Conversely, failure to do so may exacerbate Ethereum’s short-term volatility.
The core contradiction in the current market lies in investors’ concerns about the macroeconomic environment and the divergence in on-chain capital flows. On one hand, rising expectations of Federal Reserve rate hikes have put pressure on risk assets, with Bitcoin prices oscillating between 70,000and80,000, failing to break the 2024 high. On the other hand, the number of Ethereum whale addresses has rebounded significantly since the beginning of 2025. Glassnode data shows that addresses holding at least 1,000 ETH (approximately $1.92 million) increased from 4,652 on January 1 to over 4,843 by March 14, a rise of more than 4%. Nicolai Sondergaard, an analyst at Nansen, noted, “The continued accumulation by whales suggests that institutional investors are positioning for a potential rebound, but short-term price movements remain constrained by market sentiment uncertainty.”
Bitcoin Price Correlation and Ethereum’s Independent Narrative
Although Ethereum’s fundamentals differ from Bitcoin’s, the correlation between their price movements tends to strengthen during bear markets. In March 2025, Bitcoin prices repeatedly tested the $78,000 support level, directly impacting ETH’s market liquidity. For example, when Bitcoin prices fell due to expectations of Fed balance sheet reduction, Ethereum often followed suit, and vice versa. This correlation is particularly evident in the derivatives market: large ETH options trades often coincide with adjustments in Bitcoin futures positions, reflecting institutional investors’ strategies to balance overall crypto market risks.
However, Ethereum’s independent narrative has not disappeared. With the deflationary effects of “The Merge” gradually becoming apparent, ETH’s annual inflation rate has dropped below 0.5%, and its positioning as an “ultra-sound money” is gaining recognition. Pellicer added, “If Ethereum can hold $1,900, its deflationary attributes may attract more traditional capital, complementing Bitcoin.” However, achieving this vision requires Bitcoin prices to remain stable to prevent the market from entering a full risk-off mode.
Historical Lessons and Current Cycle Differences
Looking back at the bear market cycle from 2023 to 2024, the price of Bitcoin rebounded after hitting the bottom of $16,000, while Ethereum climbed from $1,000 to $4,100 due to the explosion of ecological applications. The particularity of the current cycle is that the participation of institutional investors has increased significantly, but regulatory pressure and macroeconomic uncertainty have also become more prominent. For example, FTX’s sale of $1.5 billion in assets two weeks before the bankruptcy of hedge fund 3AC (Three Arrows Capital) in 2024 still has a profound impact on market psychology.
For Ethereum, $1,900 is not only a technical watershed between bulls and bears, but also a psychological “trust threshold.” If this price level is breached, it may trigger a chain reaction similar to the LUNA collapse in 2023 in the short term, especially DeFi protocols with higher leverage ratios may face a liquidation crisis. However, Sandgaard believes: “Unlike the previous cycle, the current ETH staked lock-up accounts for 25% of the circulating supply, which provides an additional buffer for the price. Even if the Bitcoin price fluctuates extremely, the staking income of Ethereum can still attract long-term holders.”
Market bottom signals and future paths
Judging from on-chain indicators, Ethereum’s “capitulation risk” is rising. IntoTheBlock’s “Cost Distribution Model” shows that once ETH falls below $1,848, more than 80% of the coin holding addresses will enter a loss-making state, which may force retail investors to cut their losses and exit. But historical data shows that such large losses often correspond to market bottoms. For example, when the price of Bitcoin fell below $20,000 in 2023, more than 60% of the addresses were in floating losses, but the price rebounded by more than 150% in the following six months.
For investors, there are currently two major variables that need to be paid attention to: one is whether the price of Bitcoin can break through the resistance level of $81,000 after the Federal Reserve’s March interest rate meeting, and the other is whether the accumulation speed of Ethereum whales is sufficient to offset the selling pressure. If the two form a positive resonance, ETH may be able to return to above $2,500 in the second quarter; otherwise, the market may enter a longer bottoming phase.
Ethereum’s battle to hold $1,900 is not just a technical struggle but also a test of market confidence and investor patience. In a crypto ecosystem dominated by Bitcoin price volatility, whether ETH can carve out an independent trajectory based on its deflationary mechanism and ecosystem innovation will be a key theme in 2025. In the short term, volatility will persist, but long-term investors may find opportunities to accumulate during dips below key support levels. As Pellicer aptly put it, “The cyclical nature of crypto markets never fails to appear—the only question is whether you can stay clear-headed when others are fearful.
