Ethereum’s performance was far from ideal as cryptocurrency loses 70% of its value
The correction in the cryptocurrency market has placed billions in losses on investors’ shoulders as the market was unable to recover from a $300 billion sell-off that fueled the streak of 11-week Ethereum losses.
Since April 2022, which became the starting point of a massive downtrend, Ethereum has lost almost 70% of its value, making it one of the worst performing assets on the market. Such a large plunge of Ether’s value is tied to the volatile nature of cryptocurrencies.
The massive decline was also compounded by issues with Beacon Chain and the massive volume of liquidations in the lending and borrowing market. With the disaster in the DeFi market, Ethereum lost a large portion of inflows and revenue.
The “death of DeFi” was called after the series of liquidations that companies like 3AC, Celcius and others faced after Ether’s plunge below $1,150. Because of having a massive non-collateralized debt, companies had no funds to defend their positions and had no other choice but to face complete liquidations, losing millions—if not billions—of users’ funds.
The decoupling of stETH from regular ETH was another low blow for Ethereum just ahead of the merger, which is expected to take place in September and bring the PoS consensus algorithm to the network and stable rewards to validators.
With the decreasing popularity of Ethereum and decentralized technologies, more funds and investors have tried to sell their ETH holdings. The block reorganization of the Beacon Chain brings a big question about the stability of Ethereum once it is launched on the PoS network.
At press time, Ethereum is trading at $1,090 and posting the first positive day in the market since June 6.
