Ether (ETH) is grappling with bearish pressures as it bounces back from the $1,800 mark. With onchain fees and network deposits plummeting to multiyear lows, the cryptocurrency faces continued vulnerability until its derivatives metrics stabilize.
Recent data reveals that ETH futures saw liquidations totaling $224 million following a 9% decline in price. Network activity has hit its lowest point in a year, and ETH's strong correlation with Bitcoin, coupled with significant outflows from exchange-traded funds (ETFs), suggests further potential downside.
The steep fall to $1,800 erased $224 million in leveraged bullish positions within two days. This 14% decrease over the past ten days has left top traders cautious. Data from options and futures, combined with sluggish onchain performance and consistent ETF outflows, underscore a precarious position around the $1,800 level.
A noticeable shift in sentiment occurred as the put-to-call volume premium for ETH options surged to 2.2x, indicating a rush for protective measures against further declines. Despite some traders selling puts in anticipation of a rebound, the market largely braces for increased volatility. The options delta skew reached 18%, highlighting a premium on puts and a clear focus on hedging.
The Ethereum network's total value locked (TVL) has dwindled to $51 billion, the lowest since May 2025. This decline in deposits to decentralized applications has driven network fees down to $13.7 million over the past month, a significant drop from the $33 million average in late 2025. The market's concern is that ETH demand for data processing may not rebound soon.
Recent $7 million ETH sales by Ethereum co-founder Vitalik Buterin have further dampened sentiment. Although these sales were intended to fund privacy-focused technologies and open-source projects, the timing has contributed to the bearish climate.
Investor confidence has also been undermined by outflows from Ether ETFs, suggesting waning institutional interest. Since February 11, US-listed Ether ETFs have experienced $405 million in net outflows, reducing total assets under management to $12.4 billion. This coincided with a surge in gold prices, with gold ETFs attracting $822 million during the same period.
Despite the gloomy onchain and derivatives outlook, Ether's downturn is not a foregone conclusion. However, the cautious stance of whales and market makers signals a prevailing bearish sentiment. Ether's price remains closely tied to Bitcoin, with a 20-day correlation exceeding 95% for the past three weeks.
As ETH hovers around $1,800, uncertainty persists about the underlying causes of this crypto bear market. This ambiguity is compelling traders to sell at a loss, and the situation may remain unchanged until derivative metrics find stability. Until then, the potential for further ETH price declines remains.