Potential Recovery Ahead for Ethereum as 53% of Addresses Face Losses Amid Market Volatility

• Recent developments indicate that approximately 53% of Ethereum (ETH) addresses are currently operating at a loss amidst ongoing market volatility.

• The price of ETH has plummeted by 52.8% over the past year, with significant declines beginning in December 2024.

• Despite the downturn, Ethereum’s exchange reserves have decreased, possibly hinting at reduced selling pressure that could aid in future recovery.

Around 53% of Ethereum (ETH) addresses are currently operating at a loss as broader market volatility continues to take a toll on ETH’s price.

The second-largest cryptocurrency by market capitalization is grappling with a challenging period worsened by macroeconomic challenges.

Majority of Ethereum Addresses Hit by Losses

In a recent post on X (formerly Twitter), CryptoRank shared that less than half of Ethereum addresses are profitable.

“47% of addresses holding ETH are in profit at the current market price of $1,900,” the post read.

In contrast, Bitcoin (BTC) has seen 86% of its holders in profit, demonstrating its relative stability compared to Ethereum. Meanwhile, Bitget Token (BGB) leads the pack with an impressive 95% of its holders currently in profit.

Nonetheless, Ethereum holders have been plunged into losses due to its falling prices. Over the past year, ETH’s price has fallen by 52.8%, with its value steadily declining since December 2024.

Moreover, amid escalated recession fears, the altcoin dropped to lows not seen since late 2023. The drop led to a wave of sell-offs, with traders scrambling to minimize losses. As COINOTAG reported earlier, Ethereum whales offloaded significant ETH holdings to avoid liquidations.

ETH’s struggles are further highlighted by its underperformance over the past week. While the broader cryptocurrency market has seen a decline of 11.0%, Ethereum has faced greater challenges, experiencing a 13.5% drop.

Alongside the price, Ethereum exchange-traded funds (ETFs) also paint a similar picture. Data from Soso Value shows that the ETFs have seen continuous withdrawals over the past two weeks. Moreover, on March 11, the total net outflow was $21.5 million.

Despite this, Ethereum co-founder Joseph Lubin remains optimistic about the future of crypto.

“Perhaps never been more bullish after the recent shakeout and much needed resets,” he posted.

While acknowledging the recent losses, Lubin believes the US government’s actions will help the country become more focused and agile. He views this as a chance for decentralized protocols like Ethereum to operate more freely and thrive. Lubin predicts that 2025 will be a pivotal year for the crypto space.

Notably, today, positive political developments contributed to a modest recovery in the crypto market. ETH also benefitted with a 0.12% increase in the last 24 hours, bringing it to $1,899.

Aside from the price movement, Ethereum’s supply on exchanges also signals a decrease in selling pressure. Ethereum’s exchange reserves have fallen to their lowest level in years, indicating that fewer holders are willing to sell their assets.

This could lead to reduced downward pressure on the price and potentially set the stage for future growth.

“This is typically a leading bullish indicator. Short squeeze incoming!” an analyst wrote on X.

While Ethereum faces significant challenges, recent trends suggest a potential for recovery. Whether this will materialize into a lasting trend or remain short-term remains to be seen.

Conclusion

In summary, the current downturn in Ethereum prices has significantly affected a majority of its addresses, with over half currently operating at a loss. Despite challenging market conditions, recent trends in exchange reserves and dwindling selling pressure hint at a potential recovery that could bolster the crypto’s future.