Ethereum Faces Deepening Crisis as Whales Near Liquidation and Investors Sour on Its Prospects

– Advertisement –

• Lookonchain reports a potential $238 million loss if Ethereum drops 4% more, triggering forced liquidations for whales.
• Ethereum’s ETH/BTC ratio hits five-year lows, now four times cheaper than its peak in November 2021.

Ethereum (ETH) is grappling with plummeting prices and a growing lack of confidence from investors. As of 2025, Ethereum has declined by 44%, with two whale accounts on the Maker DeFi platform nearing a liquidation point.

The current predicament involves over $238 million in Ethereum held by these whales, which is under threat as Ethereum’s price edges closer to their liquidation thresholds. According to Lookonchain, a cryptocurrency analytics firm, if Ethereum’s price falls by an additional 4%, these major holders will face the liquidation of their substantial positions.

This situation is made more precarious by the Ethereum to Bitcoin (ETH/BTC) rate, which has reached its lowest since May 2020. This marks a nearly five-year low, highlighting the diminishing relative strength of Ethereum compared to Bitcoin. From its November 2021 peak, ETH/BTC is now approximately four times cheaper.

As the $ETH price drops, the 125,603 $ETH($238M) held by these two whales on #Maker is at risk of liquidation again.

The health rate has dropped to $1.07, with liquidation prices at $1,805 and $1,787, respectively.https://t.co/0QEJXGq0Lghttps://t.co/sDWFBgfGLf pic.twitter.com/iEEDZTg945

— Lookonchain (@lookonchain) March 29, 2025

Amid these market conditions, the mood among Ethereum investors has darkened. The recent price action has brought Ethereum close to completing its worst first quarter in many years, with a week-over-week loss of 6.3% and an alarming year-to-date decline.

Adding to the grim outlook, Quinn Thompson, Chief Investment Officer at Lekker Capital, a macro hedge fund, has expressed a severe verdict on Ethereum’s viability as an investment vehicle.

Make no mistake, $ETH as an investment is completely dead. A $225 billion market cap network that is seeing declines in transaction activity, user growth and fees/revenues. There is no investment case here. As a network with utility? Yes. As an investment? Absolutely not. pic.twitter.com/XjZNjPjy2s

— Quinn Thompson (@qthomp) March 28, 2025

“ETH as an investment is completely dead” Thompson stated, pointing to declining transaction activity, user growth, and network revenues which do not support an investment case, despite the underlying network retaining its utility.

Thompson’s analysis suggests a stark separation between Ethereum’s ecosystem growth and the actual value accrual to its core asset. While the broader ecosystem, including Ethereum’s Layer 2 solutions, might be expanding, this has not translated into enhanced performance or increased value for the primary Ethereum token.