Ethereum Amid FTX Crisis: ETH Plunges 22%
Ethereum and the rest of the crypto markets are now experiencing yet another crippling calamity. They call it the ‘black swan’ event, which caused the disintegration of one of the largest crypto exchanges in the world, FTX.
With claims of mismanaged customer funds and alleged government scrutiny, Binance, the largest cryptocurrency exchange in the world, abruptly backtracked on Wednesday and announced it would not be buying rival FTX.com.
The term “black swan” is a metaphor for an unexpectedly large and consequential event that can be explained away with the benefit of retrospect.
The market recovery vibes of the past several weeks have been dashed, and major cryptocurrencies have fallen to their lowest levels since 2022 as a result of this occurrence.
This is contributing to a severe decline in the cryptocurrency market. During the early hours of Thursday, the global crypto market cap dropped by over 10% to $809 billion, bringing down major cryptocurrencies with it.
Binance CEO Changpeng Zhao and FTX CEO Sam Bankman-Fried (left). Image: NBC News.
Ethereum: A Quick Glance At Price Performance
In light of recent events, the value of Ethereum and the broader cryptocurrency markets has dropped precipitously over the past few hours.
During the US midterm elections, the value of the second largest cryptocurrency plummeted. Even though ETH is down, technicals indicate a so-called “sweep-the-lows” event may be on the horizon.
Here’s a quick diagnosis of ETH: Since the beginning of November, its value has dropped by 30%, and all signs point to a continued rise in volume even as the altcoin continues to decline in price.
Additionally, trading volume on all cryptocurrency exchanges in the last 24 hours increased by 94% to $230.29 million. As of this writing, DeFi has a volume of $10.46 billion, or 4.54%% of the entire 24-hour volume of all cryptocurrencies.
ETH Loses Grip On $1,200 Handle – Will Ethereum Drop Further?
As of this writing, ETH has lost its grip on the $1,200 handle, trading at $1,190, and down 21% in the last seven days, according to data from Coingecko, Wednesday.
All but the stablecoins in the top 100 cryptocurrencies are in the red right now, while the others are tinted green.
Currently, Ether is consolidating, and its price could soon challenge the $1,000 support area.
In the past week, Ethereum has lost 27.3 percent of its value, which is greater than Bitcoin, which lost 27.3 percent. In addition, when selling pressure remained, prices dropped below the $1250 monthly support level.
Meanwhile, with Binance’s planned purchase of FTX no longer happening, the market seems ready for a drop in ETH and other major cryptocurrencies’ prices.
ETH market cap at $145 billion on the daily chart | Featured image from The Merkle News, Chart: TradingView.com