Ethereum is following the broader crypto market lower, with the coin losing another 6-7% on Thursday.
ETHUSD – Daily Chart
ETHUSD has failed to retake the $3,350 level and is sinking further. Investors should be wary of a low volume move lower to previous support, but $2,500 is the first target.
The publicly traded Ethereum treasury firm BitMine Immersion Technologies added 54,000 ETH to its balance sheet over the last week, the firm said Monday.
BitMine’s Chairman Tom Lee is still calling for an Ethereum “supercycle,” predicting that the coin could rise 100x in price in the long run.
“We look at five explanations for the crypto price cycle and conclude that two have important explanatory value,” said Lee in a statement. “Both of these suggest a crypto cycle top likely 12-36 months away”.
Lee also suggested that a market maker may have forced the coin lower.
“When a market maker has a ‘hole’ on their balance sheet, they are seeking to raise capital and are reducing their liquidity functions in the market,” he said.
“This is the equivalent of QT (quantitative tightening) for crypto, and has the effect of dampening prices. In 2022, this QT effect lasted for 6-8 weeks. And this is probably happening today”.
However, Lee projected strong year-end prices and the top two cryptos are struggling badly.
Ethereum is currently down more than 14% over the last seven days. Other big losers are XRP, down 16% and AD, down around 20%.
Meanwhile, Donald Trump and his family are suffering from the crypto downturn after they supported the industry. Shares in Trump Media & Technology Group, which announced plans to hold crypto assets, are now down 70% year-to-date, wiping billions off the family’s wealth.
It cannot be ruled out that the President will make a statement soon, leading to a rally. A “tariff dividend” was mentioned recently, or a possible announcement of purchases for the U.S. strategic crypto reserve, which fell flat after his inauguration.
