$ETH If the 2300 level is breached: Liquidation crisis, market panic, and response strategies
1. Liquidation crisis, market panic
Leverage contract risks at an all-time high: Right now, a lot of people in the exchanges are betting on ETH rebounds with 50x and 100x leverage, and 2300 USD is their 'line of life and death'. Once ETH falls below this price point, the system will automatically trigger liquidation, akin to activating a selling robot—selling more as it drops, and dropping more as it sells, leading directly into a death spiral.
Staking large holders are also not escaping a calamity: Many people are currently staking ETH, and many large holders are borrowing money against their staked ETH. If the price of ETH plummets, they either have to add margin or watch helplessly as their staked ETH is confiscated by the platform. In March, a large holder staked 36,000 ETH, and when the price fell sharply, they were directly liquidated.
2. Retail panic, institutional withdrawal
Retail investors rush to cut losses: If ETH falls below 2300 USD, it equates to breaking the psychological barrier for retail investors. The number of small holders with positions below 100 ETH has decreased by 12% compared to last month, and if it drops further, even more people will likely cut losses and exit. Just like the plunge in February, where many people tried to bottom at 2600 USD, only to see it drop to 2300 USD and take a loss.
Large institutions can't hold on any longer: Grayscale and other institutions have already withdrawn 370 million USD this year. BlackRock's ETF is still buying, but the scale is far from sufficient.
3. How should ordinary people respond?
Leverage players should quickly reduce positions: Don't think about betting on a rebound; the current market sentiment is like a powder keg, and a negative news event could ignite it.
Dollar-cost averaging investors can wait for opportunities: If ETH really falls below 1800 USD, consider buying in batches, but definitely don’t invest everything at once.
Summary: ETH is now like walking on a tightrope, with 2300 USD being that tightrope. Once it falls below, the market will surely experience turmoil in the short term, but if it can hold, there are upgrade benefits worth期待. Remember, don't go against the market; surviving gives you a chance to turn things around.
