Ethereum Plunges to 14-Month Low: Some Choose to Liquidate, Others See It as a "Great Buying Opportunity"

On June 4th, dragged down by ongoing fund outflows from the ETF market and macro risk aversion sentiment, Ethereum (ETH) fell to $1,715 in early trading, the lowest since April 2025, retreating about 65% from the August 4th high of $4,955.

Meanwhile, the total market capitalization of the entire crypto market also evaporated nearly $120 billion on the same day, down 5.7% to $2.26 trillion.

Faced with this rapid plunge, analysts have shown very different stances. Bitrue research director Andri Fauzan Adziima described this decline as a textbook-style capitulation sell-off at the end of a cycle;

He pointed out that rising U.S. bond yields, tensions between the U.S. and Iran, and increasing macro risk aversion have prompted investors to shift toward safer assets like AI stocks, triggering this sell-off.

Despite macroeconomic pressures, DeFi lock-up volume remains stable at $39 billion, with 32.5% of circulating tokens locked long-term, and staking volume hitting a record high. Therefore, now is an excellent time to position in Ethereum.

However, the chief analyst at macro trading platform Milk Road chose to liquidate all ETH holdings on Thursday, reasoning that he believes Ethereum will trade sideways long-term, lacking upward momentum.

Another analyst countered, stating that Ethereum’s market cap cannot remain forever between $200 billion and $300 billion. The entire crypto asset class will either grow to trillions of dollars or go to zero in the future.

Meanwhile, Lisk research director Leon Waidmann, through on-chain data analysis, found that although the ETH price on exchanges has fallen to multi-year lows, market holders have not panicked and sold off, but instead continued to increase their holdings and consolidate positions.

Waidmann also said that short-term price movements are mainly suppressed by market pessimism, while on-chain real holding behaviors better reflect the true value of assets. Currently, the market trend has diverged clearly from on-chain fundamentals.

In summary, the market is in a standoff between short-term panic and long-term confidence. Although exchange ETH balances have fallen to over a year low and staking volume has hit a record high, holders are choosing to increase their holdings rather than sell, but prices are still dominated by macro risk aversion sentiment.

This divergence between fundamentals and price trends often signals an imminent directional breakout, and investors should closely monitor subsequent market movements for clearer signals.