Ethereum’s monthly drop hits 23 percent and whales plunge into losses! What does this mean for $ETH?

Ethereum has struggled under sustained selling pressure throughout June, plummeting from levels above $2,000 to around $1,557 as of June 26. This marks a monthly loss of 23.5 percent, while the past week alone saw ETH shed 6.7 percent of its value.

Market dynamics reveal weaknesses

A key threshold has been crossed in the overall market cap rankings. Tether’s total market capitalization rose to $186.06 billion, surpassing Ethereum, which stands at $185.66 billion. For the first time in history, Tether has overtaken Ethereum by market value.

Market analyst Ted Pillows noted that Ethereum is once again testing bottom levels, and the momentum remains weak due to a broader market correction. According to Pillows, if ETH can reclaim the $1,750 mark, investors could see a short-term rebound in the coming month.

The technical outlook on the daily chart supports this pressure. After breaking below the upward trendline formed in February, ETH fell beneath the $1,900 and $1,800 supports, reaching as low as the $1,550 region.

Major investor groups fall into losses

Data from CryptoQuant reveals that all major Ethereum investor groups, including wallets holding more than 100,000 ETH, are now sitting on unrealized losses. The last time this scenario occurred was back in 2019, which coincided with a long-term bottom for ETH. CryptoQuant, a widely-followed on-chain analytics provider, monitors this data across the crypto industry.

Historically, collective capitulation by large holders has more often signaled proximity to market bottoms rather than deeper declines. While smaller whale groups occasionally slip into losses, it is rare for the largest wallets to dip into negative territory at the same time.

Meanwhile, the Estimated Leverage Ratio indicator has dropped from 1.11 to 0.85 over the past three weeks. This decline points to a significant number of leveraged positions being closed or liquidated, which could help limit some of the downside risk for ETH.

ETF outflows and funding concerns

Ethereum spot ETFs are on track for their seventh straight week of net outflows. According to SoSoValue, the current week may mark the heaviest capital flight from spot ETH ETFs since January.

Protocol Guild coordinator Trent Van Epps has also raised concerns about core development funding. After five years with the Ethereum Foundation, Van Epps emphasized that approximately $30 million per year is needed to sustain essential development activities, warning that current reserves may not reliably cover emerging needs. Protocol Guild is recognized for its role in funding core Ethereum developers.

Van Epps highlighted that Protocol Guild has distributed around $40 million to developers over the past four years, but he stressed that this is not sufficient. He suggested that new institutional participation may be required in the coming months to bridge the funding gap.

On the technical side, the key support levels for ETH are now at $1,510 and $1,500, while resistance sits at $1,710 and $1,774. The MACD indicator has turned negative once again, with the signal line currently at negative 78.35.

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