As the cryptocurrency market keeps declining, the Ethereum Foundation finds financial difficulty. The Foundation, mostly dependent on Ethereum’s valuation, is under strain because of this decline. Although recent strategic actions try to reduce these risks, problems still exist that influence the foundation’s financial stability and general market attitude.
The Ethereum Foundation is a key player in the Ethereum (ETH) ecosystem and supports the network’s development and growth. Recently, the foundation has changed its financial approach, from selling ETH to borrowing against it.
This modification, made on March 3, represents a major risk should ETH’s price fall to $1,100, causing a $100 million liquidation risk. Currently trading around $1,800, ETH is recording a 16-month low and a 60.98% drop from its all-time high.
Institutional Sentiment Shifts
Ethereum is attracting conflicting signals in institutions. Deutsche Boerse’s affiliate, Clearstream, will introduce crypto custody services for Bitcoin and Ethereum, targeting over 2,500 institutions by late 2025. This marks a big milestone in regulated acceptance.
With $34 million in net outflows on March 10 (including $23.7 million from Fidelity’s FESH ETF) sentiment on Ethereum ETFs has turned pessimistic. This reflects increased caution among institutional investors amid market volatility.
Ethereum’s technical issues are rising, and the Pectra upgrade is facing delays. The Holesky testnet regained finality following disturbances, but Sepolia suffered difficulties including empty blocks. These setbacks have increased community concerns about Ethereum’s development pace and trustworthiness, influencing investor confidence and market sentiment greatly, since scalability improvements are highly sought.
ETH Price Under Pressure
Ethereum’s price action is distinguished by heightened volatility, with a 55% rise in daily volatility. The important support level at $1,800 is under pressure, and a breach might prompt cascading liquidations. Liquidation clusters are stacked at $1,926, $1,842, and $1,793, posing serious dangers to the Ethereum price stability.
The market structure remains unstable, with eight straight days of selling pressure from March 6-11. Ethereum’s price has exhibited no signs of reversal, keeping investors cautious. ETH remains at its realized price support of $2,066, so a breakdown could lead to additional falls.
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