Ethereum-Based Reset Raises Questions About Next Price Move: What Happens Next?
Ethereum continues to struggle below the $2,000 level, indicating persistent selling pressure and volatile market sentiment. The inability to regain this psychological edge has kept traders on the defensive, with volatility rising and confidence waning as negative sentiment spreads throughout the crypto market. Although corrections are not uncommon after strong cycles, the current environment is showing clear signs of stress, with investors closely watching liquidity and derivative positions for clues about the next move.
Related Reading
CryptoQuant’s latest report provides more context by highlighting a significant cut in Ethereum’s future open profit. Data tracking the 30-day change in open interest across the major exchanges shows that the derivatives market is in a clear phase of reduction and risk adjustment. The decline appears to be concentrated in key exchanges such as Binance, Gate.io, OKX, and Bybit, pointing to a broad outflow of capital from strong positions.
According to statistics, Binance alone recorded a decrease of approximately 40 million ETH in open interest last month, while Gate.io saw a decrease of more than 20 million ETH. OKX posted a reduction of approximately 6.8 million ETH, Bybit contributed approximately 8.5 million ETH, bringing the combined reduction across these platforms to approximately 75 million ETH.
Broad Deleveraging Suggests Ethereum Market Reset
The CryptoQuant report also notes that when additional platforms showing negative open interest readings are included – even those with relatively small volume – the total shortfall across all markets exceeds 80 million ETH in the past 30 days. This ensures that the reduction trend is not isolated to a few large areas but represents a broad structural change in the entire Ethereum derivatives ecosystem.
Such widespread declines in open interest usually indicate that traders, especially those relying on profit-taking, are reducing exposure rather than starting new speculative positions. This behavior may reflect caution following higher volatility or pressure from recent price declines that have resulted in margin adjustments. Historically, similar situations often arise during periods of market volatility, when speculative momentum cools, and risk management becomes a priority.
From a structural point of view, this type of contraction can act as a “cleanser” of the market. By gradually removing weakly used positions, the likelihood of sudden termination of cascades can be reduced over time. Although this does not guarantee a quick recovery, excess energy output tends to stabilize market conditions. In the case of Ethereum, the ongoing reset of derivatives could help establish a solid price base if broader liquidity conditions and investor sentiment begin to stabilize.
Related Reading
Ethereum Faces Structural Stress Below Key Weekly Support
Ethereum’s weekly chart shows continued downward pressure after losing the $2,000 level, an area that previously served as psychological support and a technical pivot during the earlier stages of consolidation. The recent decline placed ETH below several major moving averages, which now act as more resistance than support, indicating weak bullish momentum and a shift to a more defensive market structure.
Price action shows a clear rejection from the $3,000–$3,500 area at the front of the cycle, followed by a sequence of lower highs. This pattern usually indicates a correction or reversal phase rather than a continuation of the previous bullish trend. The recent decline has been accompanied by higher trading volume, suggesting distribution and reduction rather than accumulation of organic matter.
Related Reading
From a structural perspective, the next logical support area is seen around the $1,600–$1,700 range, where earlier consolidation and demand has emerged. Holding this position will help maintain a broad long-term framework despite current weakness. A sustained break below it, however, could increase the chances of a deeper recovery phase.
Ethereum remains highly sensitive to macro liquidity conditions, derivatives positions, and overall crypto market sentiment, and recovery depends on renewed demand and stability above key technical levels.
Featured image from ChatGPT, chart from TradingView.com
