TL;DR
- Possible collapse of Ethereum: It is warned that Ethereum (ETH) could fall to around $1,000, following a pattern similar to that of 2019.
- Logarithmic regression analysis: The logarithmic regression band suggests that ETH’s current price may be aligned with a fair value analysis as the Fed cuts rates.
- ETH/BTC relationship: Although ETH/USD could continue to fall, it is indicated that the ETH/BTC pair may have found a bottom.
In a recent analysis, the renowned cryptocurrency analyst Benjamin Cowen has issued a strong warning about the future of Ethereum (ETH), suggesting that it could face a significant drop in value.
Cowen, who has over 818,000 subscribers on his YouTube channel, compares the current situation of ETH with the behavior of the asset in 2019, when the price of ETH plummeted at the start of a rate-cutting cycle by the Federal Reserve.
According to his analysis, the cryptocurrency could slide towards the lower bound of the logarithmic regression band, which would bring it to a value close to $1,000.
Cowen’s analysis is based on the premise that the logarithmic regression band is a useful tool for tracking the fair value of an asset without being affected by bubble data.
In his video, Cowen explained that the drop in the price of ETH could align with the Federal Reserve’s recent policy, which has begun cutting interest rates. This phenomenon is reminiscent of the trend observed in 2019, when the ETH/USD pair reached its lower trend line just as the Fed started adjusting rates. According to the analyst, this could signify a challenging period for Ethereum as we approach the fourth quarter of 2024.
Cowen also discusses the ETH/BTC pair, suggesting that it may have found a bottom in the market. He mentions that, in 2019, the ETH/BTC pair hit its lowest point before ETH/USD did the same, which has coincidentally occurred recently in September 2024.
While he does not rule out the possibility of a slight additional decline for ETH/BTC, he remains optimistic about a potential rebound in 2025, where the pair could start climbing again.
At the time of the analysis, the ETH/BTC pair was trading at 0.03905 BTC ($2,618), registering a 1.74% drop in the last 24 hours. In this context, it is crucial for investors and cryptocurrency enthusiasts to closely monitor these developments, as the Federal Reserve’s decisions and market trends can significantly impact the future direction of Ethereum and other cryptocurrencies.
Future Perspectives for Ethereum
As we move towards the end of 2024, attention is focused on how monetary policies will influence the cryptocurrency market.
History has taught us that the correlation between the Fed’s decisions and the performance of digital assets can be strong. Investors should be prepared for the volatility that may come in the coming months.
On the other hand, it is important to consider that, although projections may seem bleak, there is always the possibility of an unexpected change in the market.
Ethereum’s resilience, along with its widespread adoption and ongoing development, could offer opportunities for those willing to take risks.
The crypto community must also stay informed and educated about these movements. Volatility not only affects prices but can also have repercussions on the development of new technologies and the regulation of the space. Therefore, the focus should be on both investment strategies and understanding macroeconomic trends.
Benjamin Cowen’s analysis highlights the importance of observing Ethereum’s behavior in light of economic changes. With the Federal Reserve implementing rate cuts, the next few months could be decisive for ETH’s future, and investors must be ready to adapt to a constantly changing market environment.
