Why Ethereum is Down Today? Market Analysis & Top Trends for Investors

Ethereum (ETH) has struggled to break through the key resistance level of about $2,760 over the past two weeks. As a result, the price has dropped more than 5 percent in the last five days, trading around $2,495 during the early European session on Friday, October 25.

This major altcoin, with a fully diluted market valuation of around $300 billion and a daily trading volume averaging $15.8 billion, is showing signs of short-term consolidation before a potential breakout toward an all-time high.

What’s driving this price slump? What does the future really hold for Ethereum?

Factors Weighing Down Ethereum’s Momentum

Rising Competition for Other Layer One Blockchain

Even though Ethereum dominates the decentralized finance (DeFi) sector—holding approximately $87 billion with a total value locked (TVL) of about $46.7 billion—newer layer one chains, especially Solana (SOL), are challenging its position. In the last 24 hours, the Solana and Tron networks registered about 4 million and 2.2 million active addresses, respectively, while Ethereum recorded only around 377,000.

The rise of these efficient and affordable networks poses a real threat to Ethereum’s dominance in the Web3 ecosystem.

Institutional Preferences Shift Towards Bitcoin

The recent approval of spot Ether ETFs and spot Bitcoin (BTC) ETFs has revealed a growing trend: institutional investors are increasingly choosing Bitcoin over Ethereum as an investment. Current market data shows that U.S. spot BTC ETFs have accumulated net assets of about $66 billion, while Ethereum’s ETFs hold only around $7 billion, following a significant decline in Grayscale’s ETHE.

Crypto analyst Benjamin Cowen believes that Ethereum’s dominance will likely continue to drop in the near term, with a potential rebound expected in 2025.

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What Technicals Tell Us

From a technical standpoint, Ethereum’s price has faced strong resistance around the $2,800 level in recent months. The altcoin is forming a potential ascending triangle pattern on the daily timeframe, indicating that buyers are struggling to break through the upper boundary.

This ongoing resistance could signal a crucial moment for Ethereum as it aims to regain its former strength.

What do you think? Will Ethereum bounce back or continue to struggle?