Introduction
Ethereum hits $1,415 on April 7, its weakest in two years, before ticking up to $1,562. It now trades around $1,607 following a slight rally.
A fierce selloff gripped the crypto market on April 7 morning, rattling traders everywhere. The total market cap of digital assets shrank by nearly 10%, pulling ETH and other top tokens to lows unseen since January 2023. CoinGlass recorded over $1.6 billion in liquidated leveraged positions in a single day, though API limits likely mask a steeper toll.
DeFi Investors Battle Liquidation Risks
As ETH slipped under $1,500, investors hustled to protect leveraged stakes. Lookonchain spotted a whale depositing 10,000 ETH – about $15 million – into Sky to defend a $340 million position. A drop below $1,119 could see this investor lose 220,000 ETH.
DefiLlama warns that ETH falling below $900 might liquidate $600 million in ETH-backed holdings. On April 6, a 14% price dive cost another whale 67,570 ETH, translating to a $106 million setback.
Global Markets Trigger Crypto Slump
BRN’s Darren Chu blames the downturn on widespread pessimism in financial markets, sparked by hefty U.S. tariffs introduced by the Trump administration over the weekend. Investors dumped risk assets early this week, favoring gold and U.S. bonds instead.
Dr. Kirill Kretov from CoinPanel observed, “Rising trade friction, geopolitical unrest, and erratic economic cues are hitting hard.” Altcoins like ETH are struggling to hold ground.
Rumors of a 90-day tariff delay briefly sparked hope, but the White House squashed them. The S&P 500 shed $7 trillion in half an hour, slipping into a bear market for the first time in three years.
Analysts Eye a Potential Bounce
Some remain cautiously optimistic. RAAC’s Kevin Rusher commented, “ETH below $1,500 was once a pipe dream—now it might be a prime buying moment for a solid network.”
BRN sees risk assets as oversold, suggesting a “Dead Cat Bounce” could emerge soon. Watch for the FOMC minutes, CPI, jobless claims, PPI, and early U.S. consumer sentiment and inflation updates.