Ethereum Remains The ‘Basket Case’ This Bull Cycle, ETH Price Dip To Continue?

While Ethereum (ETH) remains a central player in the crypto market, it faces mounting challenges in its quest for widespread adoption. Moreover, a recent report by 10x Research suggests that Ethereum is the “basket case” in this bull cycle. This has raised concerns about the ETH price’s future trajectory as it recently lost hold on a crucial level.

Will Ethereum Price Continue To Dip?

The 10x Research report noted that despite Ethereum’s pivotal role in facilitating DApps and the NFT market, its weak fundamentals have become a cause for concern. It negatively affects Bitcoin’s trajectory due to the correlation between these crypto behemoths. In addition, the poor fundamentals also bring doom to the Ethereum ecosystem.

During the previous cycle, Ethereum was positioned as a revolutionary force set to supplant traditional banking systems. However, its failure to swiftly address scalability issues and adapt to changing market dynamics has left it trailing behind. Whilst, Bitcoin has now assumed the mantle of digital gold, leaving ETH behind.

Meanwhile, the correlation between Bitcoin and Ethereum remains strikingly high, with an R-square of 95%. This underscores the interconnectedness of the two largest cryptocurrencies. Hence, Ethereum’s struggles are proving to be a “roadblock” for Bitcoin, hindering broader fiat inflows into the crypto ecosystem.

The lower amount of inflows is also a reason why Ethereum price is plummeting harder than Bitcoin. In addition, FTX has been dumping ETH to complete the liquidation process. Furthermore, hackers are leveraging Tornado Cash to get rid of the stolen ETH funds.

Analysts warn of further downside for Ethereum, with price predictions suggesting a further dip. As the ETH price extended below $3,132.80, the impending decline became evident. The breach of this critical support level signals a continuation of the bearish trend, with the next target set at $2,905.30.

However, if Ethereum manages to breakout above $3,132.80, the bearish trend could be over. As of writing, the ETH price was down by 3.10% to $3,078.99 on Tuesday, May 6. Moreover, the second largest crypto by market cap attained a low of $3,027.59 amid the decline today.

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FTX & Crypto Hackers Dump ETH

FTX, tha bankrupt crypto exchange founded by Sam Bankman-Fried, has expedited its liquidation spree lately. Since the beginning of this week, the organization has offloaded over $12 million worth of Ethereum. The two transactions highlighted by Peck Shield Alert, a blockchain tracker, saw a transfer of $6.3 million and $6.17 million worth of ETH, respectively.

This ETH dump was direct toward Coinbase and Wintermute. Whilst, crypto hackers who stole Ethereum funds have been using Tornado Cash for anonymized transactions and realizing profits. According to a post on X Peck Shield Alert, Poloniex hackers, who led to a compromise of $125 million worth of crypto assets, transferred 200 ETH to Tornado Cash.

Furthermore, Kronos Research hackers, who stole $26 million of crypto funds, joined the fray. They also transferred 200 ETH to Tornado Cash. In addition, they shifted $4 million of Ethereum to a new wallet to commence laundering via Tornado Cash.

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