Ethereum Faces Potential Value Decline

Prominent crypto strategist Benjamin Cowen has emphasized the looming risk of Ethereum (ETH) losing substantial value as the Federal Reserve embarks on a new phase of interest rate reductions. He pointed out that ETH might repeat a pattern seen in 2019, forecasting a possible drop toward the lower limits of the logarithmic regression band.

How Do Interest Rate Cuts Affect Ethereum?

Cowen explained that the logarithmic regression band serves to assess the asset’s genuine value without the influence of inflated data. Historically, when the Fed initiated rate cuts, the ETH/USD pair has tended to dip below this logarithmic trend line—a pattern Cowen believes could manifest once more.

“The reason I compare 2024 to 2019 is that during the rate hike cycle, looking only at interest rates, the ETH/USD fell to the lower logarithmic regression trend line when the Fed started cutting. The same thing is happening again. The Fed begins to cut, and the ETH/USD trend turns downward.”

What Is the Current Status of ETH/BTC?

Currently, the ETH/BTC pair is trading at 0.03905 BTC ($2,618), having experienced a 1.74% decline within the last day. Cowen indicated that while the ETH/BTC pair may have reached its lowest point, the ETH/USD could still face further depreciation as interest rates are lowered.

• The ETH/USD pair could decline further in the wake of Federal Reserve actions.
• The ETH/BTC pair suggests a potential market low, though ETH/USD remains uncertain.
• Market conditions and Fed policies will significantly influence Ethereum’s trajectory.

Ethereum’s performance is set against the backdrop of the Fed’s monetary decisions and prevailing market conditions, urging participants to remain vigilant in their strategies and decisions. Observations and analyses about the ETH/USD and ETH/BTC dynamics indicate that further declines in Ether may also adversely affect other altcoins in the market.