Ethereum (ETH) price has been plummeting after the recent US air strike on Iranian nuclear facilities, triggering investor anxiety. As geopolitical tensions escalated, ETH dropped below $2,200 over the weekend. Although it partially recovered, it recorded approximately a 15% decline over the past week. With market uncertainty deepening, experts are warning about the potential for further decline in Ethereum.
According to Matrixport, where crypto analyst Markus Thielen is affiliated, the current Ethereum futures positions are distorted by excessive leverage, and the liquidation process has not yet been fully completed. Thielen warned investors to be cautious, stating that "in such an overcrowded leverage structure, selling pressure is likely to continue". The recent sharp decline is largely attributed to the amplification of losses due to an unusually high leverage ratio.
Despite these weak fundamentals, Ethereum has been strengthening its relative trading dominance on Binance. According to CryptoQuant, from January 2023 to May 2025, ETH trading volume has remained relatively stable at 300-490 trillion, while other altcoins saw significant volume reductions after peaking in November last year. This indicates that investors are moving funds towards the relatively stable ETH as uncertainty increases, avoiding riskier smaller coins.
When market anxiety grows, some assets can show resilience due to risk-off capital inflows. Ethereum is becoming an increasingly notable asset in such situations, with growing potential to secure market share in the medium to long term.
However, in the short term, investors are advised to approach cautiously as futures position settlements and geopolitical risks could trigger further Ethereum weakness. The current cryptocurrency market is significantly responding not only to technical factors but also to global political variables, necessitating a strategy of close observation.
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