Who can save ETH? The path Ethereum has taken to reach this point is not without clues. Its predicament is both the cost of its own choices and the result of external competition. First, Ethereum's positioning determines its fate. As a highly decentralized public chain, it refuses to sacrifice security and decentralization for higher TPS. Second, the competition in the public chain space has never ceased. The business of block space is not Ethereum's exclusive patent; EOS was a flash in the pan, Solana has risen later, and every new public chain's emergence eats into Ethereum's market share. Perhaps the most fatal flaw is the design defect of the PoS mechanism.
Cryptocurrency analyst Benjamin Cowen recently stated that Ethereum will have to undergo a period of "pain" before it rebounds. The current trend is repeating the pattern of the 2019 market cycle:
The ETH/BTC trading pair needs a change in monetary policy to bottom out, and to achieve a change in monetary policy, one must go through pain. Welcome to the period of pain; this is the necessary pain. Remember the last cycle (2019), the bottom for ETH/BTC occurred after ETH/USD broke the support level.
Benjamin Cowen pointed out that the time when Ethereum/USD price broke the support level in 2019 coincided with the Federal Reserve ending its quantitative tightening policy. He believes that everything that happened in the last cycle "is basically repeating in this cycle, only this time the time cycle is longer," and that most price points in the current cycle are about 10 times that of the 2019 market:
The reason people find it difficult to grasp the market trend this time and feel that this cycle is different from previous ones is that the monetary policy in this cycle has never changed.
In the last cycle, we saw changes in monetary policy a year before the Bitcoin halving. And now, we are already a year after the halving, yet we still have not seen any changes in quantitative tightening. We have seen the Federal Reserve slightly slow its pace; they have reduced the intensity of tightening, but they have never truly stopped.
Previously, analyst Alessandro Ottaviani also warned that the current trend of Ethereum is in a "falling knife" state, meaning that the price is rapidly declining without obvious support, and recklessly entering the market to "catch the knife" could face even more severe losses.
