Ethereum (ETH) dropped below the $2,000 level for the first time in nearly two months, a situation that pushed traders back into “buy the dip” mode according to blockchain analytics firm Santiment.
However, Santiment pointed out that the sudden wave of optimism around ETH’s decline could be a warning sign in itself.
Crowd Optimism Points to More Downside
Santiment’s reasoning is that when a major token drops through a key psychological level, traders often split into two camps, with one group panicking and writing off the asset and the other piling in even more because they believe they are catching a discount.
Per the firm’s analysis, the second scenario is what is happening currently with Ethereum.
“Retail has erupted with ‘buy the dip’ calls toward $ETH,” it wrote on X, adding that this kind of crowd optimism at a local bottom usually means the price still has some more falling to do.
That’s because, in Santiment’s assessment, retail crowds tend to get such calls wrong and get too optimistic, and anyone buying before panic fully sets in will be doing so before the actual floor arrives.
As such, the firm advised patience, saying:
“There will be an opportunity to buy Ethereum, but ideally you will want to wait for the majority to cool down their FOMO and begin to show panic. This way, you will be buying while there is true blood in the streets.”
A glimpse at the market backs up that bearish backdrop, with ETH trading around $1,975 at the time of writing, which is a nearly 5% drop in the last 24 hours and almost 8% in the red over seven days.
The world’s second-largest cryptocurrency is also down around 14% from where it was 30 days ago and is sitting about 60% below its all-time high registered in August 2025 when it stopped a few dollars short of $5,000.
Data from CoinGlass shows that about $241 million in ETH positions were liquidated in the past day alone, with longs making up the vast majority of that figure at roughly $228 million compared to just $13 million in shorts.
Those lopsided liquidation numbers reflect just how many traders were caught offside betting on a recovery.
Ethereum Network’s Success Isn’t Showing in ETH Prices
All the above is happening at a time when debate around Ethereum’s future is hitting fever pitch, with Bankless co-founder David Hoffman saying that he had sold his ETH stash.
He said that, while Ethereum has succeeded as a network, he is unsure whether ETH itself still has a strong path toward a major long-term repricing.
According to him, Ethereum has become more beneficial to stablecoins, tokenized assets, and decentralized apps at the expense of its own native token, calling the network “a giver, not a taker.”
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