In the volatile world of cryptocurrency, Ethereum (ETH), often hailed as the king of public blockchains, has recently experienced a significant price decline. This article aims to delve into the reasons behind Ethereum's plummet, explore its future prospects, and also introduce Pi Coin, another cryptocurrency that has caught the attention of many in the crypto community.
Recently, Ethereum has faced a notable drop in its price. In mid - June, ETH tumbled from a peak of $2,878, experiencing a 26% decline, which was more than twice as much as Bitcoin's 10.89% fall during the same period. This sharp decline was a cause for concern among investors and analysts alike.
One of the key factors contributing to this decline is the behavior of short - term holders (STH). When ETH dropped below the $2.5k mark, the STH NUPL (Net Unrealized Profit/Loss) of Ethereum directly fell into the surrender zone. The surge in actual losses indicated that STH started to liquidate their positions during the downturn. As ETH rebounded to the $2.5k area, it re - entered a high - density cost - basis cluster. Many Ethereum holders bought their supply in the range of $2.4k to $2.6k. These holders might view the rebound as an opportunity to break even and exit their positions, which could act as a significant resistance for further price increases.
Moreover, despite Ethereum's strong performance in the first and second quarters, it has yet to reclaim the psychological barrier of $3k. This has led some investors to sell their holdings in advance, especially considering the persistent macro - risks in the market.
| Bullish Factors | Bearish Factors |
|---|---|
| The recent $100 million of ETF funds flowing into Ethereum is encouraging, indicating new capital entering the market. Additionally, the 9.3% increase in Binance ETH perpetual contract open interest with a bullish bias shows that there is still confidence from traders. | The high - density cost - basis cluster around $2.4k - $2.6k may cause many short - term holders to sell when the price approaches this range. The failure to break through the $3k psychological barrier for a long time may also lead to some investors losing confidence and selling their positions. |
Despite the recent price slump, Ethereum has some promising technological developments that could potentially drive its price up in the future. In May 2025, the MVRV - Z Score of ETH dropped to - 0.18, entering the "severely undervalued" range, while the number of active addresses in its Layer 2 ecosystem reached a record high of over 13.6 million.
One of the most significant technological breakthroughs is the EIP - 9698 proposal. If implemented, this proposal could revolutionize Ethereum's performance. It plans to increase the Gas limit from 36 million to 3.6 billion in two phases over four years. From 2025 - 2026, the Gas limit will be increased tenfold to 360 million, and the single - block transaction capacity will jump from 180 to 6000. From 2027 - 2028, the Gas limit will be increased another tenfold, enabling 2000 transactions per second. This could reduce the main - net transaction cost by 90% and lower the threshold for high - frequency DApp development.
Pi Coin is a relatively new cryptocurrency that has gained popularity, especially among the general public. Unlike traditional cryptocurrencies that require high - end mining equipment, Pi Coin can be mined using a mobile phone. It aims to create a more inclusive and accessible cryptocurrency network.
The Pi Network, the platform behind Pi Coin, focuses on building a community of users. By simply installing the Pi mining app on their mobile devices, users can start mining Pi Coin. The project emphasizes security, scalability, and user - friendliness. However, it should be noted that Pi Coin is still in the development phase, and its value and future viability are yet to be determined.
One of the main attractions of Pi Coin is its potential to become a widely used digital currency. With its easy - to - use mining process, it has the potential to attract a large number of users from different backgrounds. But like any other cryptocurrency, it also faces challenges such as regulatory issues and competition from other established cryptocurrencies.
| Bullish Factors | Bearish Factors |
|---|---|
| Its easy - to - use mobile mining mechanism can attract a large number of users, potentially building a large and active community. The concept of an inclusive and accessible cryptocurrency has a certain appeal in the market. | Pi Coin is still in the development stage, and there is no clear indication of its future value. It also faces regulatory uncertainties and strong competition from well - established cryptocurrencies like Bitcoin and Ethereum. |
Ethereum's recent price plummet is a result of a combination of short - term holder behavior, the psychological resistance of the $3k mark, and broader market risks. However, its technological advancements, such as the EIP - 9698 proposal, offer hope for a potential rebound in the future. On the other hand, Pi Coin presents an interesting concept of an accessible cryptocurrency, but its future is still uncertain due to its development stage and the challenges it faces in the highly competitive cryptocurrency market. As always, investors should DYOR (Do Your Own Research) before making any investment decisions in the volatile world of cryptocurrencies.
FAQ:- Q: Is it a good time to buy Ethereum now? A: It depends on your investment strategy and risk tolerance. While Ethereum has faced a price decline, its technological developments are promising. However, the short - term resistance around the $2.4k - $2.6k area and the psychological $3k barrier are factors to consider.- Q: Can Pi Coin become as valuable as Bitcoin? A: It's very difficult to predict. Pi Coin is still in the early stages of development, and it faces many challenges. Bitcoin has established itself as the leading cryptocurrency over many years, and Pi Coin would need to overcome significant hurdles to reach a similar level of value.