Ethereum (ETH) is facing a tough week as its price struggles to stay above the critical $1,600 mark, while the broader crypto market reacts
The cryptocurrency market is showing signs of recovery after a tumultuous period, with Bitcoin (BTC) showing strength as it approaches the $85,000 mark. However, the outlook for Ethereum (ETH) remains uncertain.
The latest data from the DeBank platform reveals that a substantial $86 million was pulled out of Ethereum in the week following the repeal of Biden-era policies mandating KYC (Know Your Customer) compliance for DeFi protocols. Of this sum, an enormous $60 million flowed into Solana (SOL), highlighting a potential shift in investor focus.
The reported figures from April 10 show a significant capital outflow from Ethereum, contrasting with Bitcoin’s resilience at around $70,000. As NVidia stock experienced a sell-off, capital surged into cryptocurrencies, BTC spearheading the movement with a touch of $85,000.
While altcoins like Bitcoin Cash (BCH) and Litecoin (LTC) also saw slight gains, the attention is on Ethereum’s dip below the $1,600 level, a critical support mark. This downturn occurred amid heightened competition from newer and faster blockchain networks like Solana, Base, Arbitrum, and Avalanche, leading to a decrease in interest in Ethereum.
Among the competitors, Solana has captured the majority of Ethereum’s outflows, collecting over 60% of the outflows with a new all-time high price of $260. This could be linked to Solana’s status as a fast and low-cost blockchain network, aligning with the preferences of cryptocurrency traders and investors.
In contrast, Ethereum, the dominant platform for decentralized applications (dApps) and DeFi protocols, is grappling with a lagging price and heightened scrutiny from regulatory bodies. As the market adjusts to the effects of the DeFi law repeal, it remains to be seen whether Ethereum will regain its footing or if newer competitors will capitalize on its challenges.
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