Ether slides below $3200 amid broad crypto market pullback

Ether fell 7.9% over the past 24 hours, with the overall crypto market down 3.45%, as investors continue to weigh the impact of Mt. Gox’s latest transfers and macro developments.

Ether was changing hands at around $3,166 at the time of writing, down 7.9% in the last 24 hours, according to The Block’s price page. Bitcoin BTC -3.081% dropped 2.52% to trade at $64,200 at the time of writing.

“The pronounced pullback… is not only unsurprising but expected,” Justin d'Anethan, head of APAC business development of crypto market maker Keyrock, told The Block. “The market’s memory is short but, while the spot bitcoin ETFs did push prices higher, in the very beginning, crypto markets went down.”

“Many speculators unwind their trade,” d'Anethan added. “This is all too common: buy the rumor, sell the news. The enthusiasm that the ETH -8.24% spot ETF applications fomented, along with the approval and now with the actual trading, led to a healthy ramp-up where people are essentially trying to front-run the event. Once the narrative has fully played out, it’s time to take profit and move on to the next trade.”

Min Jung, an analyst of Presto Research, said that the price movement appears to be a typical “sell-the-news” event, which is common in the crypto market. “Additionally, this sell-off coincided with the news that Bitstamp has received Mt. Gox assets and will distribute them to creditors. Furthermore, the SP 500 and Nasdaq both fell over 3.5%, marking the worst day since 2022 due to disappointing earnings from tech companies, which may have added pressure on the crypto market,” Jung added.

The U.S. stock market registered multi-week lows on Wednesday. The Nasdaq Composite index closed down 3.6%, marking its worst day since October 2022, while the SP 500 index fell 2.3%, experiencing its worst day since December 2022.

Bitstamp said on Wednesday that it has begun the process of returning digital assets to Mt. Gox creditors, as it has received bitcoin, bitcoin cash and Ethereum from the Mt. Gox trustees. It plans to begin distributing the crypto assets to Bitstamp customers starting Thursday, July 25.

Nick Ruck, head of growth of BitU Protocol, said that traders may believe the market to be overheated with stock and crypto prices falling. “Due to the rapid volatility of these prices, many traders may take some profit until conditions become more stable,” Ruck added.

“Despite the price drop of ETH, we expect the drop to be temporary when market sentiment improves and the ETH price rally in the mid-long term,” said Lucy Hu, senior analyst of Metalpha.