Ethereum’s Funding Rates plummeted to FTX-era lows as derivatives faced a severe macro shock. Heightened tensions between the U.S. and Iran have sparked a wave of risk aversion, leading to a significant decline in Ethereum as leverage intensified the downward momentum. As the price dipped to the $2300 mark, forced selling intensified, resulting in the liquidation of approximately $1.1 billion in ETH positions amid a wider market wipeout totaling around $2.5 billion. The mounting pressure pushed perpetual prices beneath their spot, leading to a funding rate on Binance that dipped to -0.028%. Bitcoin faced similar stress over the weekend, driven by the same catalyst: geopolitical risk tightening liquidity.
In unison, ETH and BTC showcased a deleveraging phase, characterized by panic-driven flows that took precedence, leading to a temporary disappearance of market depth. BitMine’s portfolio shows significant strain as ETH hovers around $2,415, contrasting sharply with an estimated weighted acquisition price of $3,800. A sharp risk-off shock, fueled by geopolitical tensions and forced deleveraging, served as the catalyst that accelerated ETH’s 7-day decline of approximately 17.7%. The action resulted in unrealized losses reaching approximately $5.9 billion on a $15.6 billion position. This drawdown approaches 40%, indicating structural pressure instead of mere noise. The cost basis now serves as a gravitational force, rather than a guaranteed support level. The timing indicated below showcases the withdrawal of liquidity and a compression of sentiment. A transition would necessitate a reduction in macro risk, an influx of renewed investments, and consistent demand in the spot market. The distance from the cost basis delineates the current drawdown distribution.
At this time, Ethereum was trading around $2,430–$2,450, marking an 8–9% decline for the day as investors shifted their capital from risk assets to safer options such as gold and silver. The shift resulted in a tightening of crypto liquidity, with ETH swiftly absorbing the pressure. The price struggled to maintain a breakout above $3,400, subsequently retreating through the $2,780–$2,800 range as momentum diminished. This rejection signifies more than just weary bulls. The macro stress and deleveraging intensified the movement, leading to a surge in liquidations and solidifying a pattern of lower highs and lower lows. Momentum indicators validated the sentiment. The weekly RSI has remained beneath the neutral line, indicating a decline in demand instead of a recovery from oversold conditions.
Meanwhile, the MACD indicator continues to show a negative trend and is compressing, indicating that bearish momentum is still present, although it may be starting to slow down. Support currently consolidates between $2,400 and $2,600, as buyers assess their conviction. A clean break could lead to a more significant decline toward the $2,000–$2,200 range, whereas stabilization would necessitate a reduction in macro pressures and a resurgence of spot inflows. Geopolitical risk has significantly drained liquidity, leading to $2.5 billion in liquidations and causing both ETH and BTC to experience a synchronized unwind. ETH’s drop beneath the ~$3,800 institutional cost basis has resulted in significant pressure for large holders, who are now contending with a nearly 40% drawdown. This level has transformed into a formidable resistance, as the price tests delicate support in the range of $2,400–$2,600.