- Ether price has plunged to the lowest point since March 16th.
- Ethereum is facing significant regulatory concerns due to staking.
- The coin is about to form a death cross pattern on the daily chart.
Ethereum price has come under intense pressure as investors worry about the ongoing regulatory concerns. ETH coin dropped to a low of $1,630, the lowest level since March 16th. In all, the coin has plunged by over 23% from its highest level this year.
ETH regulatory concerns
The main reason why Ethereum and other cryptocurrency prices are falling is the recent lawsuits by the Securities and Exchange Commission (SEC). One of the main concerns that the SEC has is that the two exchanges were offering unregistered securities in their platforms.
In the Coinbase case, the SEC accused the company of offering staking services. Staking is a process that allows people to deposit funds and then earn a return. They earn the return since staking helps to secure the network.
This is where Ethereum’s challenges come in. For one, Ethereum migrated from being a proof-of-work platform to a proof-of-stake blockchain during last year’s merge event. As a result, the network’s fundamentals changed significantly during that process.
The SEC believes that companies like Binance and Coinbase should not offer staking solutions unless they are regulated. It believes that without regulation, the exchanges could give customers a raw deal. It also believes that these exchanges could commingle funds and lead to losses. Data shows that investors have staked ETH worth over $32 billion.
The SEC has already settled with Kraken, which promised not to offer the staking solutions in its platform. And in a statement last year, Gary Gensler, the head of the SEC said that he believed that Ethereum had become a financial security after the merge.
Therefore, there is a likelihood that American exchanges will be forced to delist Ethereum depending on the outcome of the SEC lawsuit. We have already seen companies like Robinhood and eToro delist some coins like MATIC and Cardano.
Ethereum price prediction
Turning to the daily chart, the ETH price formed a head and shoulders pattern, which is usually a bearish signal. At the same time, it has dropped below the 50-day and 200-day exponential moving averages (EMA). And a death cross, which happens when the two averages cross over is about to happen.
Ethereum is also approaching the 50% Fibonacci Retracement level. Therefore, it seems like bears are in control, which will see it drop to the next support level at $1,500. A break below $1,500 will open the possibility of it falling to $1,000.
