Ethereum holders see worst profit drop since 2023 – Is this good news?

Negative sentiment and retail dumping

The market sentiment toward Ethereum is largely negative, fueled by Fear, Uncertainty, and Doubt (FUD) surrounding its price decline.

Rumors, macroeconomic pressures, and increasing competition have intensified the bearish outlook. Retail traders, in particular, are feeling the impact, with many choosing to sell at a loss rather than risk further declines.

This mass selling creates significant downward pressure but also lays the groundwork for a potential market reversal.

Once the panic subsides and stability returns, these conditions may present opportunities for a rebound, particularly if larger institutional investors step in.

ETH’s rebound potential

As Ethereum’s profitability drops to its lowest levels in months, historical patterns suggest that such downturns often precede recovery phases.

At the time of writing, only 66.9% of ETH tokens were in profit, down from 97.5% just two months ago — showing waning confidence among holders.

Total coins in profit stand at a mere 99.8M, the lowest since the 4th of November 2023.

Source: Santiment

However, underperforming periods in Ethereum’s past have often paved the way for rebounds, driven by external catalysts like regulatory clarity, Ethereum 2.0 milestones, or improving macroeconomic conditions.

Such recoveries are typically marked by sharp reversals, as oversold conditions and improving sentiment trigger renewed investor interest.

Read Ethereum [ETH] Price Prediction 2025-2026

For Ethereum, shifts in profitability metrics may serve as key indicators of impending market stabilization.

Should the percentage of supply in profit rise, it could spark confidence among sidelined investors, paving the way for a broader price recovery.