FameEX Hot Topics | $4K Ethereum Rally Odds Plunge as Derivatives Turn Bearish

Ethereum investor sentiment is faltering as major whales stay sidelined, unconvinced by the modest 15% bounce from last Friday’s $2,623 low. A combination of stagnant on-chain activity and persistently bearish derivatives positioning has sharply reduced the probability of a sustained rally to $4,000, leaving the market searching for a credible catalyst.

Since Monday, leveraged bullish demand has virtually vanished. Perpetual futures funding rates have hovered near zero or dipped negative—far below the healthy 6–12% annualized range needed to compensate long holders. Much of this caution stems from the lingering trauma of October 10’s 20% flash crash, which triggered cascading liquidations across centralized and decentralized venues and left deep psychological scars on traders.

On-chain metrics reinforce the gloom. DefiLlama data show Ethereum’s total value has plunged from $99.8 billion on October 9 to just $72.3 billion today—a nearly 28% drop in six weeks. Network fees have fallen 13% week-over-week despite stable transaction counts, indicating shrinking deposit sizes and waning economic activity. Lower fees mean fewer ETH tokens are burned via EIP-1559, tilting the supply dynamic toward inflation and adding another layer of downward pressure.

History suggests that aggressive central bank liquidity injections could rescue risk assets from similar setups, but persistent uncertainty around U.S. employment and growth continues to weigh on confidence. Capital is currently rotating into tech equities and fixed-income markets rather than cryptocurrencies. Until major central banks signal fresh stimulus or Ethereum’s on-chain fundamentals show a decisive turnaround, the road to $4,000 remains heavily blocked, keeping both whales and retail investors in cautious, wait-and-see mode.

Disclaimer: The information provided in this section is for reference only and does not represent any investment advice or the official views of FameEX.