Ethereum Price Drop and Market Analysis

Ethereum, like the broader crypto market, has experienced a sharp drop in price in recent weeks. From a high of $3,352 at the start of 2025, Ether now trades around $1,800 and $1,900, reflecting a 47% drop from last year’s value.

Price Correction and Market Factors

Latest analyses suggest Ether’s price correction will likely be extended. The altcoin is facing a huge bearish wave, influenced by several market factors. A significant issue is Standard Chartered’s recent decision to cut its price prediction by 60%, aligning with market expectations.

> News: Standard Chartered slashes ETH price target! 🚨
> The bank cuts its 2025 ETH forecast from $10K to $4K, blaming Layer-2 networks like Base, which they say has drained $50B from Ethereum’s market value.
> — Andres Meneses (@andreswifitv) March 17, 2025

Ethereum Faces A Descending Channel

Ethereum is currently in a price slump, with expectations for a deeper dive in the coming weeks. Ether’s price has been hovering above the $1,900 level amidst bearish price movements. Analysts use the MACD indicator to verify the asset’s bearish sentiment, while moving averages suggest a neutral trend with possibilities for price consolidation.

> Ethereum (ETH) remains in the correction zone today, trading around $1,874. The price continues to move in a descending channel, indicating a possible continuation of consolidation. Moving averages confirm the neutral trend: the price is holding below the 50-day and 200-day MA…
> — LVelarde (@0xvelarde) March 17, 2025

Standard Chartered Cuts Price Estimates For Ethereum

Even major banks like Standard Chartered Bank are lowering their expectations for Ethereum. From a high of $10,000, the bank is reducing its price target to just $4,000, attributing this to the impact of Layer 2 solutions on Ethereum’s valuation. Changes in blockchain technology, such as the shift to proof-of-stake and scalability improvements, are also factors.

Analyst Geoff Kendrick argues the dominance of L2s like Base has cost Ethereum an estimated $50 billion in market cap. He considers this a “midlife crisis” for the blockchain, indicating Ethereum has become a commodity within its Layer 2 environment.

Potential Solutions for Ethereum

Kendrick suggests two ways for Ethereum to address its downturn:
1. Leverage its security-based dominance in the tokenization of real-world assets (RWA) to maintain an 80% market share.
2. Implement potential taxes on Layer 2s, although this is considered unlikely. Kendrick anticipates continued underperformance in the short term.

Featured image from Bloomberg, chart from TradingView