Ethereum (ETH) Investor Overview
Investors who opened ETH positions at high price levels are running low on purchasing power, raising concerns about its recovery potential, as noted by Chinese on-chain data analyst Murphy.
Murphy shared statistics indicating that the average cost basis for ETH positions created between January and February 2025 ranged from $3,200 to $3,500. A noteworthy cluster of addresses saw their holdings increase to $3,475 by accumulating approximately 1.66 million ETH. This group did not buy more when ETH dipped to $1,900, and currently holds about 1.94 million ETH, decreasing their average cost to $3,150.
On the other hand, addresses that opened positions in mid-February 2025 had entry costs between $2,600 and $2,800. When the price of ETH fell below $2,300, they began selling off their holdings. Currently, only positions at $2,800 (1 million ETH) and $2,630 (850,000 ETH) remain unaltered.
As ETH trends downwards, new buying interest has diminished greatly, especially with prices falling below $2,000. This suggests that investor interest has almost vanished at these levels.
Murphy highlighted that investors who bought ETH at higher prices have now largely depleted their purchasing power after multiple attempts to average down their costs. The $1,850 price point is significant as it represents the cost basis for many investors who entered positions two years ago. They tend to repurchase portions sold previously to lower their overall costs, potentially creating a support zone. However, if $1,850 fails to hold, ETH could decline towards $1,600 or even $1,250, which may see accumulation from three years ago acting as critical support, according to the analyst.
Murphy concluded that a market recovery hinges on restoring investor confidence in ETH’s long-term value. Without renewed consensus, the large accumulations at $2,630, $2,800, and $3,150 may form substantial resistance, hindering any future recovery.
This is not investment advice.
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