ETH Hits $3.4K But Several Factors Put A Pause On Ether’s Rally
Despite briefly hitting $3,400, Ether's rally paused due to professional trader caution, weak DApp demand, and falling network fees.Summary
Ether (ETH) recently corrected by 4% after touching $3,400, liquidating $65 million in leveraged long futures. Professional traders remain neutral-to-bearish, evidenced by the low 4% annualized premium on ETH monthly futures, suggesting a lack of confidence. This sentiment is partly linked to the broader crypto market decline, but also specific Ethereum weaknesses, notably a sharp drop in demand for decentralized applications (DApps) and fading memecoin activity. While Ethereum base layer transactions grew, network fees fell by 31%, contrasting with competitors where fees rose. Lower network activity reduces ETH staking yields, disincentivizing holding. Furthermore, institutional flows, including modest US spot ETF inflows ($123 million since Jan. 7) and corporate ETH holdings, have not restored broad investor confidence. The market skew shows put options trading at a 6% premium, signaling professional traders expect limited upside, suggesting ETH's near-term price hinges more on external factors than internal ecosystem developments.
(Source：Cointelegraph)