Ethereum Price Prediction – Why ETH Could Drop Below $2000 Again

Highlights:

• Ethereum is range-bound as the market seeks direction 
• ETH bears driven by low ETF inflows even as Bitcoin inflows pick up
• Ethereum could rebound if Bitcoin turns bullish in the day

Like the rest of the market, Ethereum is relatively inactive today. At the time of going to press, Ethereum was trading at $2071.20, a 0.89% decrease. However, trading volumes increased by 3.64% to $12.23 billion, showing investors are still interested. If the market keeps going up, Ethereum has the potential to keep gaining in value. However, there are a multitude of reasons for short-term downside pressure. 

Ethereum Lagging Behind Bitcoin In ETF Inflows

The most recent report on CoinShares’ crypto asset fund flows demonstrates a change in attitude. After five weeks of outflows, Crypto investment products saw an inflow of $644 million last week. According to CoinShares’ Head of Research, James Butterfill, the total for assets under management has steadily increased by 6.3% since March 10, and inflows are reported daily for the week. This indicates a more positive sentiment from investors. However, this money is flowing more into Bitcoin than Ethereum. 

Bitcoin has attracted $724 million in new capital after reversing a five-week outflow streak of $5.4 billion. In contrast, Ethereum has suffered the most significant outflows of all digital assets, with ETH investment products experiencing a drop of $86 million. It could be a bearish signal for Ethereum in the short term. 

🚨 Breaking: The total Ethereum Spot ETF net inflow remained quiet on Monday, March 24, with zero inflow after 12 consecutive days of negative inflow.

Is this a good sign for $ETH? pic.twitter.com/sj9lWmWW8v

— Oliver Wong (@0xOliverWong31) March 25, 2025

Moreover, US spot Ethereum exchange-traded funds (ETFs) experienced 13 straight days of net outflows last week, losing $390 million. ETH ETFs are struggling to provide positive cash flow, which is affecting on-chain activity, with transaction numbers reaching a trough not seen since before Trump’s victory in the presidential election. These lower Ethereum transaction fees are causing a sharp decline in the ETH burn rate. An increase in the deflationary trend may pose additional downside pressure on Ethereum’s price.

ETH/BTC has bottomed

Brutal honesty I never thought it would get this low but in hindsight it makes sense

Ethereum sacrificed revenue in the short term to supercharge its L2 initiative, at the same time the SEC approved the ETFs but disallowed staking, this made the ETF… pic.twitter.com/AdN755ZULB

— artchick.eth/acc 🔥👠 (@digitalartchick) March 25, 2025

ETH’s Trading and On-Chain Metrics Suggest Market Slowdown

Additionally, on-chain metrics suggest a dip in network activity. Active Ethereum addresses dropped by 5% to 400,000, suggesting lower user participation. Similarly, decreasing Ethereum transaction fees points to reducing interest. The historical decline in transaction fees has also contributed to ETH’s lackluster performance compared to leading digital currencies.

Grayscale believes this is because market players value Ethereum using the fee-capture model. This and macroeconomic headwinds like President Trump’s tariff threats have contributed to Ethereum’s value dropping 35% in the last two months.

✨The daily Ethereum burn volume has hit a historic low — on March 22, only 53 ETH (~$106,000) were removed from circulation, the lowest ever recorded.

The decrease in burning negatively impacts network activity: the number of active Ethereum addresses has dropped to its lowest… pic.twitter.com/erVwxuguHE

— Siempredrop (@siempredro18344) March 24, 2025

Ethereum Facing Stiffer Competition

Grayscale has also linked Ethereum’s price underperformance to competitors like Solana. The firm pointed out that Solana is capturing market and fee revenue share in the smart contract domain. This could cause Ethereum’s value to drop further in the long term. This is especially the case because Solana’s price seems to be responding better to Bitcoin rallies than Ethereum’s. 

Technical Analysis – ETH Range Bound But Bears Targeting Support

Ethereum is currently rangebound between $2097.6 resistance and $2042.8 support.

If bears take control and push Ethereum through the $2042.8 support, a price correction below $2000 could follow. On the other hand, if bulls take control and push Ethereum through the $2097.6 resistance, then a rally to $2500 or higher could follow. 

Recap

Ethereum is at a multidirectional crossroads. Ethereum’s price direction will depend on broader and macro-market sentiments around transaction fees and network activity. However, if there is a rally in the price of Bitcoin, Ethereum could likely follow suit, like the rest of the altcoin market.