{"id":467795,"date":"2022-06-26T16:45:51","date_gmt":"2022-06-26T13:45:51","guid":{"rendered":"https:\/\/en.buradabiliyorum.com\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\/"},"modified":"2022-06-26T16:45:51","modified_gmt":"2022-06-26T13:45:51","slug":"how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion","status":"publish","type":"post","link":"https:\/\/buradabiliyorum.com\/en\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\/","title":{"rendered":"# How low can Ethereum price drop versus Bitcoin amid the DeFi contagion?"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_85 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-6a41a2cf25ce9\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #dd3333;color:#dd3333\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #dd3333;color:#dd3333\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-6a41a2cf25ce9\" checked aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-1'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/buradabiliyorum.com\/en\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\/#%E2%80%9D_How_low_can_Ethereum_price_drop_versus_Bitcoin_amid_the_DeFi_contagion_%E2%80%9C\" >&#8221; How low can Ethereum price drop versus Bitcoin amid the DeFi contagion? &#8220;<\/a><ul class='ez-toc-list-level-2' ><li class='ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/buradabiliyorum.com\/en\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\/#ETHBTC_dynamics\" >ETH\/BTC dynamics<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/buradabiliyorum.com\/en\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\/#Ethereum_TVL_wipe-out\" >Ethereum TVL wipe-out<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/buradabiliyorum.com\/en\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\/#Bitcoin_struggling_but_stronger_than_Ether\" >Bitcoin struggling but stronger than Ether<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/buradabiliyorum.com\/en\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\/#ETHBTC_downside_targets\" >ETH\/BTC downside targets<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h1><span class=\"ez-toc-section\" id=\"%E2%80%9D_How_low_can_Ethereum_price_drop_versus_Bitcoin_amid_the_DeFi_contagion_%E2%80%9C\"><\/span>&#8221; How low can Ethereum price drop versus Bitcoin amid the DeFi contagion? &#8220;<span class=\"ez-toc-section-end\"><\/span><\/h1>\n<div class=\"post-content\" data-v-2a0745c6>Ethereum&#8217;s native token Ether (ETH) has declined by more than 35% against Bitcoin (BTC) since December 2021 with a potential to decline further in the coming months.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-06\/3bf838f1-4fb8-4748-b73f-181eaef08ebe.png\"><figcaption style=\"text-align: center;\"><em>ETH\/BTC weekly price chart. Source: TradingView<\/em><\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"ETHBTC_dynamics\"><\/span>ETH\/BTC dynamics<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>The ETH\/BTC pair&#8217;s bullish trends typically suggest an increasing risk <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/download-scripts-themes-apps\/\" data-internallinksmanager029f6b8e52c=\"9\" title=\"Download Scripts &amp; Themes &amp; Apps\" target=\"_blank\" rel=\"noopener\">app<\/a>etite among crypto traders, where speculation is more focused on Ether&#8217;s future valuations versus keeping their capital long-term in BTC.\u00a0<\/p>\n<p>Conversely, a bearish ETH\/BTC cycle is typically accompanied by a plunge in altcoins and Ethereum&#8217;s decline in market share. As a result, traders seek safety in BTC, showcasing their risk-off sentiment within the crypto industry.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Ethereum_TVL_wipe-out\"><\/span>Ethereum TVL wipe-out<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Interest in the Ethereum blockchain soared during the pandemic as developers started turning to it to create a wave of so-called decentralized finance projects, including peer-to-peer exchange and lending platforms.<\/p>\n<p>That resulted in a boom in the total value locked (TVL) inside the Ethereum blockchain ecosystem, rising from $465 million in March 2020 to as high as $159 billion in November 2021, up more than 34,000%, according to <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/defillama.com\/chain\/Ethereum\">data from DeFi Llama<\/a>.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-06\/2b36777c-3de3-434b-a27a-52e93e906e1d.png\"><figcaption style=\"text-align: center;\"><em>Ethereum TVL performance since 2019. Source: DeFi Llama<\/em><\/figcaption><\/figure>\n<p>Interestingly, ETH\/BTC surged 345% to 0.08, a 2021 peak, in the same period, given an increase in demand for transactions on the Ethereum blockchain. However, the pair has since dropped over 35% and was trading for 0.057 BTC on June 26.<\/p>\n<p>ETH\/BTC&#8217;s drop coincides with a massive plunge in Ethereum TVL, from\u00a0$159 billion in November 2021 to $48.81 billion in June 2022, led by a contagion fears in the DeFi industry.<\/p>\n<p>Also, institutions have withdrawn $458 million this year from Ethereum-based investment funds as of June 17, suggesting that interest in Ethereum&#8217;s DeFi boom has been waning.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"Bitcoin_struggling_but_stronger_than_Ether\"><\/span>Bitcoin struggling but stronger than Ether<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Bitcoin has faced smaller downsides compared to Ether in the ongoing bear market.<\/p>\n<p>BTC&#8217;s price has dropped nearly 70% to around $21,500 since November 2021, versus Ether&#8217;s 75% drop in the same period. <\/p>\n<p>Also, unlike Ethereum, Bitcoin-focused investment funds have seen <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/blog.coinshares.com\/volume-85-digital-asset-fund-flows-weekly-report-3362c4017078\">inflows of $480 million year-to-date<\/a>, showing that BTC&#8217;s drop has done little to curb its demand among institutional investors.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-06\/7691e812-e372-4192-8e2f-d34ee55a9895.png\" alt=\"\" title=\"\"><figcaption style=\"text-align: center;\"><em>Investment flows into\/out of crypto funds by assets. Source: CoinShares<\/em><\/figcaption><\/figure>\n<h2><span class=\"ez-toc-section\" id=\"ETHBTC_downside_targets\"><\/span>ETH\/BTC downside targets<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p>Capital flows, coupled with an increasing distrust in the DeFi sector, could keep benefiting Bitcoin over Ethereum in 2022, resulting in more downside for ETH\/BTC.<\/p>\n<p><strong><em>Related:\u00a0Swan Bitcoin CEO against crypto lenders: Users are way under-compensated for the risk<\/em><\/strong><\/p>\n<p>From a technical perspective, the pair has been holding above a support confluence defined by a rising trendline, a Fibonacci retracement level at 0.048 BTC, and its 200-week exponential moving average (200-week EMA; the blue wave in the chart below) near 0.049 BTC.<\/p>\n<figure><img decoding=\"async\" src=\"https:\/\/s3.cointelegraph.com\/uploads\/2022-06\/b533e107-09e4-4d81-bee9-0c45bb953ad1.png\"><figcaption style=\"text-align: center;\"><em>ETH\/BTC weekly price chart. Source: TradingView<\/em><\/figcaption><\/figure>\n<p>In a rebound, ETH\/BTC could test the 0.5 Fib line next near 0.062. Conversely, a decisive break below the support confluence could mean a decline toward the 0.786 Fib line at 0.027 in 2022, down more than 50% from today&#8217;s price.<\/p>\n<p>The ETH\/BTC breakdown might coincide with an extended ETH\/USD market decline, primarily due to the Federal Reserve&#8217;s quantitative tightenig that has recently pressured crypto prices lower against the U.S. dollar.\u00a0<\/p>\n<blockquote class=\"twitter-tweet\">\n<p lang=\"en\" dir=\"ltr\"><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/search?q=%24ETH&amp;src=ctag&amp;ref_src=twsrc%5Etfw\">$ETH<\/a> historical Bear Markets correction depth:<\/p>\n<p>\u2022 -72% <\/p>\n<p>\u2022 -94%<\/p>\n<p>\u2022 -82% (and counting)<\/p>\n<p>Read more about <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/hashtag\/ETH?src=hash&amp;ref_src=twsrc%5Etfw\">#ETH<\/a> Market Cycles here:<a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/5hIo7SC1n6\">https:\/\/t.co\/5hIo7SC1n6<\/a><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/hashtag\/Crypto?src=hash&amp;ref_src=twsrc%5Etfw\">#Crypto<\/a> <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/hashtag\/Ethereum?src=hash&amp;ref_src=twsrc%5Etfw\">#Ethereum<\/a> <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/t.co\/7Ol0q3xM9G\">pic.twitter.com\/7Ol0q3xM9G<\/a><\/p>\n<p>\u2014 Rekt Capital (@rektcapital) <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/twitter.com\/rektcapital\/status\/1540717684542672898?ref_src=twsrc%5Etfw\">June 25, 2022<\/a><\/p><\/blockquote>\n<p><script async src=\"https:\/\/platform.twitter.com\/widgets.js\" charset=\"utf-8\"><\/script><\/p>\n<p>Conversely, weaker economic data could prompt the Fed to cool down on its tightening spree. This could limit Ether and the other crypto assets&#8217; downside bias in the dollar market, per\u00a0Informa Global Markets.<\/p>\n<p>The firm <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/www.bloomberg.com\/news\/articles\/2022-06-22\/bitcoin-sinks-again-as-risk-off-mood-returns-on-recession-fears\">noted<\/a>:<\/p>\n<blockquote><p>\u201cMacroeconomic conditions need to improve and the Fed\u2019s aggressive approach to monetary policy has to subside before crypto markets see a bottom.&#8221;<\/p><\/blockquote>\n<p>But given Ethereum has never reclaimed its all-time high against Bitcoin since June 2017 despite a strong adoption rate, the ETH\/BTC pair could remain under pressure with the 0.027-target in sight.<\/p>\n<p class=\"post-content__disclaimer\">The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.\n<\/p>\n<p><template data-name=\"subscription_form\" data-type=\"markets_outlook\"><\/template><\/p>\n<\/div>\n<blockquote><p><strong><span style=\"color: #ff6600;\">If you liked the article, do not forget to share it with your friends. Follow us on\u00a0<span style=\"color: #ff0000;\"><a style=\"color: #ff0000;\" href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMLG0nwswvr63Aw\" target=\"_blank\" rel=\"nofollow noopener noreferrer\">Google News<\/a><\/span>\u00a0too, click on the star and choose us from your favorites.<\/span><\/strong><\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\">For forums sites go to <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/forum.buradabiliyorum.com\/\" target=\"_blank\" rel=\"noopener\">Forum.BuradaBiliyorum.Com<\/a><\/span><\/strong>\n<\/p><\/blockquote>\n<blockquote>\n<p style=\"text-align: center;\"><strong>If you want to read more <a href=\"https:\/\/buradabiliyorum.com\/en\/category\/news\/\" data-internallinksmanager029f6b8e52c=\"2\" title=\"News\" target=\"_blank\" rel=\"noopener\">News<\/a> articles, you can visit our <span style=\"color: #ff9900;\"><a style=\"color: #ff9900;\" href=\"https:\/\/en.buradabiliyorum.com\/general\/\" target=\"_blank\" rel=\"noopener\">General category.<\/a><\/span><\/strong><\/p>\n<\/blockquote>\n<p><span style=\"color: black;\"><a style=\"color: #ff9900;\" href=\"https:\/\/cointelegraph.com\/news\/how-low-can-ethereum-price-drop-versus-bitcoin-amid-the-defi-contagion\" target=\"_blank\" rel=\"noopener\">Source<\/a><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"<p>&#8221; How low can Ethereum price drop versus Bitcoin amid the DeFi contagion? &#8220; Ethereum&#8217;s native token Ether (ETH) has declined by more than 35% against Bitcoin (BTC) since December 2021 with a potential to decline further in the coming months. ETH\/BTC weekly price chart. Source: TradingView ETH\/BTC dynamics The ETH\/BTC pair&#8217;s bullish trends typically&#8230;<\/p>\n","protected":false},"author":1,"featured_media":467796,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"fifu_image_url":"https:\/\/images.cointelegraph.com\/images\/1200_aHR0cHM6Ly9zMy5jb2ludGVsZWdyYXBoLmNvbS91cGxvYWRzLzIwMjItMDYvYzE1MDdjMTgtMWRiMi00ZjMwLWEyY2MtYzk0YjhmMWFjYTY5LmpwZw==.jpg","fifu_image_alt":"","footnotes":""},"categories":[1],"tags":[81951,74937,82402,74891,74938,74939,78261,70550,73785],"class_list":["post-467795","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-bitcoin-analysis","tag-bitcoin-price","tag-ether-price","tag-ethereum","tag-ethereum-price","tag-market-analysis","tag-tech-analysis","tag-federal-reserve","tag-markets"],"_links":{"self":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/467795","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/comments?post=467795"}],"version-history":[{"count":0,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/posts\/467795\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media\/467796"}],"wp:attachment":[{"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/media?parent=467795"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/categories?post=467795"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/buradabiliyorum.com\/en\/wp-json\/wp\/v2\/tags?post=467795"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}