- ETH/BTC falls below 0.02, signaling stronger capital rotation into Bitcoin.
- Ethereum DeFi TVL drops $12B in six weeks amid user demand decline.
- ETH price risks $1,100 target as bearish flag and weak indicators persist.
Ethereum is showing fresh signs of market weakness as the ETH/BTC trading pair dropped below a critical support level this week. With Ethereum’s share of the crypto market falling and confidence slipping, traders are now watching the $1,100 mark as a possible downside target.
ETH/BTC Breach Highlights Market Shift to Bitcoin
The ETH/BTC pair has slipped below 0.02 for the first time in years, underlining the steady capital rotation into Bitcoin. This shift follows recent macroeconomic data and concerns surrounding Ethereum’s regulatory environment. At the same time, Ethereum’s market share across DeFi and Layer-1 activity has declined sharply.
The broader move comes just a week after President Donald Trump reversed a DeFi-related regulatory policy. The rollback, which aimed to reduce compliance burdens, has instead increased uncertainty among developers and institutional investors. Capital outflows have accelerated, pushing Ethereum further behind competitors such as Solana and Avalanche.
DeFi TVL Declines as On-Chain Activity Softens
According to DeFillama data, investors have withdrawn over $12 billion from Ethereum DeFi protocols since the start of March 2025.
Ethereum’s total value locked in DeFi protocols fell from $58 billion to $46 billion in just six weeks. This $12 billion drop underscores a sharp decline in user demand and signals weakening network fundamentals. Meanwhile, Ethereum Layer-2 solutions like Arbitrum and Optimism are processing more volume, drawing activity away from the mainnet.
Despite the implementation of the Dencun upgrade in March 2025, the improvements have not resulted in higher user engagement. Gas fees have dropped, but active wallet growth and transaction activity have remained flat. As capital continues flowing into other ecosystems, Ethereum’s network dominance has slipped below 55 percent.
Bear Flag Signals Deeper Correction Risk for ETH
The price of Ethereum dropped under $1,600 during this week and it has settled around $1,580 in current trading. Market experts indicate that dropping past $1,597 will confirm a new target level near $1,100 based on measured move analysis. A bearish flag formation combined with ongoing selling pressure from institutional investors sustains the price drop.
The daily RSI reading sits near 42, suggesting ETH is approaching oversold territory. However, recovery will require sustained buying and improved metrics. The inability to recover key levels at $1,385 and $1,730 will confirm the bearish trend according to traders.
Ethereum exhibits feeble technical indicators because its 50-day, 100-day, and 200-day moving averages maintain a downward trend. The persisting weakness in ETH/BTC trading signals potential further price declines in the near future.
Ethereum continues to experience growing difficulties on both technical and fundamental levels. ETH/BTC reaching new low levels combined with worsening investor sentiment suggests that Ethereum might drop to $1,100 soon. The future stability of Ethereum hinges on key price levels and on-chain data analysis.
