Ether fell 6% and dropped below the key $2,000 level. At this mark, it outperformed Bitcoin as market sell-offs continued. Meanwhile, BTC failed to hold above the $70,000 level.
Ether’s decline was practically in sync with Bitcoin’s, reflecting an exceptionally high correlation between the two assets, with coefficients exceeding 0.9. Since the sell-off in October, Ether lost ground at an accelerated pace and ultimately broke below a key band of the Market-to-Realized Value (MVRV) indicator, a level that in previous cycles had coincided with market bottoms.
Bitcoin, meanwhile, retreated by nearly 50% from its peak reached in late 2025 and early 2026 around $126,000. The asset encountered significant resistance around $71,000, a level it failed to sustainably recover.
Under this interpretation, the price action is seen as part of a broader regime shift. The persistent weakness suggests that the market is still adjusting macroeconomic and liquidity expectations, which is keeping institutional investors and risk managers cautious.
Why is Ether still falling?
The downward pressure was driven by a combination of interrelated factors. The Federal Reserve’s quantitative easing reduced systemic liquidity and diverted capital away from higher-risk assets. This was compounded by selling by miners, forced to liquidate positions due to declining profitability, as well as high leverage that triggered cascading liquidations and reduced the depth of order books.
The risk-averse environment was broader than just the crypto sector. The selling extended to other risk assets, while the growth of the artificial intelligence segment was also cited as a significant competitor for available liquidity in financial markets.
The flows, however, were not entirely uniform. Although Bitcoin and Ether saw net outflows, some of the capital rotated into tokens like XRP and Solana, suggesting a selective reallocation of portfolios rather than an indiscriminate sell-off of altcoins.
The immediate implication is a scenario of persistent volatility and tighter liquidity for fund managers, exchanges, and derivatives desks. Forced selling and increased margin requirements raise operating costs and put pressure on net asset values, increasing the risk of redemptions in leveraged products.
In the short term, the market will be closely watching whether Bitcoin manages to recover the $71,000 level; a failure to do so would likely prolong selling pressure and keep Ether exposed to further declines, while a sustained recovery could ease the deleveraging process.
