Ethereum could see a drastic price drop to as low as $200–$400 if the crypto market has entered a new bear cycle, according to Quit, vice president of blockchain at Yuga Labs.
In a Mar. 11 post on X, Quit questioned optimistic price targets for Ethereum (ETH). While many see $1,500 as a likely floor for ETH, he warned that if the downturn is only beginning, historical trends suggest an 80–90% drawdown could push prices as low as $200–$400.
He also pointed out that Ethereum’s 30% weekly drop and 50% decline over the last three months don’t necessarily mean the worst is over, as true bear markets can erase much more value.
Despite this outlook, Quit remains personally bullish but advises investors to reconsider their allocations if they are not prepared for further downside.
Meanwhile, Ethereum whales are already positioning for further potential price declines. On Mar. 11, Lookonchain flagged a significant transaction in which a wallet linked to the Ethereum Foundation recently deposited 30,098 ETH (~$56.08 million) into MakerDAO (MKR) to lower its liquidation price. This wallet now holds 100,394 ETH ($182 million) on Maker, with a liquidation threshold of $1,127.
In a separate transaction, an Ethereum ICO whale also moved 7,000 ETH (~$12.94 million) to Kraken, signaling possible selling pressure.
Ethereum is struggling for several reasons, such as falling network activity, falling institutional demand, and growing competition from cheaper, quicker blockchains. Spot Ethereum exchange-traded funds have witnessed net outflows of about $119 million in the past week alone, according to SoSoValue data.
Some analysts have noted that Spot ETH ETFs appear to be less attractive than decentralized finance’s 4.5% stablecoin yields due to their absence of staking incentives.
At the same time, Ethereum’s dominance in DeFi and perpetual futures trading is under threat due to its fragmented layer 2 ecosystem and growing competition from platforms like Hyperliquid (HYPE) and Berachain (BERA), which have garnered billions in total value locked.
As a result of declining network activity and lower gas prices, ETH has also failed to retain its deflationary status, with its supply now growing at an annual rate of 0.7%. While it was intended to reduce inflation, the EIP-1559 burn mechanism has struggled to offset fresh issuance.
It is unclear if ETH will soon be able to recover its previous $2,600 support in the absence of ETF staking incentives and increased DeFi demand. As of press time, Ethereum is trading at about $1,850, with $246 million in liquidations over the past 24 hours, as per Coinglass data.
