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Ethereum’s price is approaching the critical $3,100 level, facing a $212 million liquidation threat. If Ethereum‘s price falls below $3,100, the liquidation of $212 million in leveraged long positions could occur, causing concern in the cryptocurrency sector.
Ethereum Price Stays Above $3,200
This prediction follows Ethereum’s price dropping sharply by 9.3% to $3,254 in the last 24 hours. On a weekly basis, ETH has seen a decline of over 18%. Therefore, a further drop below $3,100 could lead to the erasure of $212 million for investors with long-focused positions.
The latest market fluctuation has led to significant liquidations of $624.4 million in just the last 24 hours. This fluctuation particularly affected long positions, with $514 million in longs and $110 million in shorts being closed. The OKX exchange experienced the highest liquidation volume with $90.8 million, followed by Binance and Bybit with liquidations of $79.9 million and $23.4 million, respectively.
Institutional Interest May Be in a Testing Phase
A Bitfinex report highlights the sharp decline in Bitcoin, the flagship cryptocurrency, since March 14, suggesting it could be a potential test of institutional interest that may lead to a price reset in the crypto market.
Altcoin market’s increasing investment flows and record outflows from ETH are strengthening the bullish narrative for Ethereum and Layer-1 Blockchain projects. Additionally, on March 11, there was a record increase in net Ethereum outflows from exchanges, with 154,000 Ethereum withdrawn.
The decreasing supply on exchanges could support upward price movements. Bitfinex points out, “Recent net flow data indicates a potential short-term upward trend for Ethereum. However, we suspect this might be due to investors moving their Ethereum to trade on an ERC-20 protocol or a Layer-2 like the Base mainnet outside of exchanges.”
This move could be interpreted as a strategic shift by investors aiming to profit through alternative trading platforms or technologies. At the time of writing, Ethereum is trading at $3,223. Looking at the king of Altcoin‘s latest price, it has dropped by approximately 20% from the $4,000 level. If the correction ends, ETH’s price could potentially move back towards $4,000.
