Ethereum’s Bullish Sentiment Evaporates Amid Market Pressure

The cryptocurrency market witnessed a significant shift in sentiment around its second-largest asset. On December 17, 2025, Ethereum failed to maintain its footing above the crucial psychological threshold of $3,000. Following a brief dip to $2,875, the price found temporary stability near $2,950. This downturn revealed a stark divergence in behavior: while retail investors exited their positions, institutional entities engaged in substantial accumulation.

A Stark Divide: Whales Accumulate as Retail Sells

On-chain analytics paint a revealing picture of the current dynamic. Over the preceding three weeks, large-scale Ethereum holders, often called “whales,” purchased approximately 934,000 ETH. This accumulation, valued at $3.15 billion, stands in sharp contrast to the actions of smaller investors, who divested roughly 1,041 ETH during the same period. This chasm between institutional confidence and retail caution is a defining characteristic of the present market environment, suggesting major players are viewing the price weakness as a strategic buying opportunity.

Leveraged Positions Unwind in a $650 Million Liquidation Storm

The descent below $3,000 triggered one of the most aggressive waves of forced liquidations seen in recent months. Within a 24-hour window, leveraged positions worth over $650 million were wiped out. Ethereum bore the brunt of this liquidation cascade, accounting for $235 million in liquidated bets—a figure notably higher than Bitcoin’s $186 million. Approximately 90% of these eliminated positions were long contracts, catching traders who had bet on rising prices during the prior consolidation above $3,000 completely off guard.

Concerning Network Metrics and ETF Outflows

Beyond price action, fundamental network indicators are flashing warning signs. The count of weekly active addresses on the Ethereum network declined throughout December, falling from 440,000 to 324,000. This represents the lowest level observed since May 2024. Transaction volumes have similarly retreated to lows last seen in July.

Should investors sell immediately? Or is it worth buying Ethereum?

The spot ETF landscape presents a mixed but concerning outlook. These funds experienced outflows for three consecutive days, totaling $224.78 million. Consequently, assets under management dropped from $21.43 billion to $18.27 billion. The negative Coinbase Premium Index further indicates heightened selling pressure originating from the United States.

The Fusaka Upgrade: A Beacon of Technical Progress

Amid the market turmoil, a significant technical development offers a counterpoint of optimism. The Fusaka upgrade, activated on December 3, 2025, introduces substantial improvements to the network. It reduces bandwidth requirements for validators by up to 85% and is projected to lower transaction costs on Layer-2 networks by 40-60%. Furthermore, the block gas limit has been increased from 36 million to 60 million, a change that could potentially scale the ecosystem’s capacity beyond 100,000 transactions per second.

The Critical Juncture: Key Levels to Watch

All attention now turns to the $2,900 support level. A decisive break below this floor could propel prices toward the $2,800 region. Conversely, for the bulls to regain control, Ethereum must reclaim the $3,025 zone. A sustained breakthrough above $3,110 would then open a path for a potential advance toward $3,250.