Ethereum (ETH) surged to $4,000 this year, nearing its all-time high of $4,891. However, as Bitcoin prices dipped due to ETF outflows, ETH followed the broader market downturn, plummeting to $3,200 and briefly touching $3,000—marking a 20% weekly drop. What’s driving this decline?
Low Approval Odds for Ethereum Spot ETFs
Earlier, Ethereum’s price was buoyed by speculation around spot ETF approvals.
Yet, the SEC has postponed decisions on ETH spot ETFs, and leading ETF analysts express skepticism about May approvals, further weakening bullish momentum.
👉 Will Ethereum ETFs Ever Get Approved? Here’s What Experts Say
"Staking Rewards" Complicate Approval
Some issuers proposed staking ETH in their ETF filings to generate additional yields—a move applauded by the community for enhancing Ethereum’s deflationary appeal.
However, this feature risks SEC classifying ETH as a security, lowering approval chances.
Restaking Protocol Ether.fi’s Token Underwhelms
Ether.fi, a top liquid restaking protocol with $2.56B in locked value, launched its ETHERFI token recently. Despite its first-mover status, the token’s performance has been lackluster, signaling muted enthusiasm for restaking projects.
The initial hype around "points farming" for airdrops has faded, leaving EigenLayer’s upcoming token launch as the next potential catalyst for restaking momentum.
👉 Ether.fi’s Airdop: What It Means for Restaking Investors
Key Factors Behind Ethereum’s Drop:
- ETF Delays: SEC’s cautious stance dims near-term institutional adoption hopes.
- Restaking Fatigue: Declining airdrop rewards reduce short-term demand.
- Macro Sentiment: Bitcoin’s ETF outflows spill over into ETH.
FAQs
Q: Will Ethereum recover its recent losses?
A: Recovery hinges on ETF approvals, EigenLayer’s token launch, and broader crypto market trends.
Q: Is staking ETH still profitable?
A: Yes, but yields may decrease as restaking hype cools.
Q: How does SEC’s view impact ETH?
A: A securities classification could restrict ETF approvals and institutional participation.
Risk Warning: Crypto investments are volatile—you may lose all capital. Assess risks carefully.
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### Notes:
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