I was sitting in a stuffy Airbnb in Lisbon back in June 2021, hammering out a newsletter while ETH free-fell from $2,600 to sub-2k. My phone kept buzzing—frantic DMs from friends who’d bought their first bit of ether a month earlier and thought the dream was over. I told them what an old miner once told me in the 2015 bear: “Crypto’s a theme park—you only puke on the roller coaster if you forget why you got on.” Two months later, those same friends were asking if it was too late to add at $3,500.
Here’s what actually happened back then
The June 2021 washout lopped roughly 35 % off ETH in three punishing weeks. Funding flipped negative across the major perp venues, Coinbase’s retail bid vanished, and every analyst on CNBC trotted out that stale "tulip" graphic. Yet hidden in the noise were two nuggets that mattered a whole lot more:
- Daily active addresses on Etherscan barely dipped—DeFi degenerates kept farming, NFT mints kept minting.
- On-chain data from Glassnode showed the exchange balance draining; whales were stuffing cold wallets while Twitter screamed capitulation.
By July 20th, ETH had bottomed near $1,720. Five months later it printed a new ATH just shy of $4,900—roughly a 200 % move from that ugly summer floor. The so-called “altcoin season” that followed made household names out of Axie, Solana, and a dozen canine memecoins.
Fast-forward to the weird summer of 2025
Now pull up a TradingView chart and you’ll see the same movie playing on a new screen. We kicked off June above $2,600—again. Sentiment was warm but not frothy, funding on Binance was a sleepy 0.01 %, and ETH/BTC sat around 0.052. Then the Iran-Israel headlines flared, the Fed hinted they might punt rate cuts, and boom—ETH bled more than 20 % in ten trading days, tagging $2,050 over the weekend.
As I write this, the wick hasn’t tapped the 2021 analogue of $1,600-1,700 yet, but the fractal is eerily similar. Nansen flow data shows smart-money wallets nibbling, while retail keeps hitting the sell button. Funding has flipped negative on Bybit perps for the first time since the pre-ETF scare in March. I can almost smell the fear through my monitor.
Why this drawdown might not be done (and why that’s okay)
I’m not entirely sure we’ve found the local floor. If we replay the 2021 cadence, ETH has another 15-20 % left to bleed, putting the pain box right around $1,700. That level lines up with the weekly 200-EMA and the cluster of long-term holder cost basis (according to Glassnode’s “Realized Price”). A lot of algos will be eyeing the same number, so don’t be shocked if we overshoot to $1,600 on a weekend liquidation cascade.
The thing is, looming pain can be a gift. Capitulation wicks are where the strongest rallies are born, because that’s where weak hands fully let go. If we get the July rate-cut rumour confirmed—or even a hint of geopolitical détente—risk assets should snap back fast. Raoul Pal keeps banging the “global liquidity cycle” drum, and for once I agree with him.
Digging into the on-chain tea leaves
Some quick hits from the dashboards I trust:
- Exchange balances: Down roughly 130 k ETH in the last 30 days. Not 2020-style exodus, but solid accumulation under the hood.
- Staked ETH: Over 33 million sitting in the Beacon deposit contract—almost 28 % of supply. Liquid staking tokens (Lido, Rocket Pool) barely flinched this week.
- Gas usage: Yep, memecoins are clogging blocks and pushing median gas back above 30 gwei. Every time that happens in a down-tick, ETH has rallied later—it’s a perverse demand signal.
- Derivatives: Negative funding on three of the top five venues, open interest fell 9 % week-over-week. That’s leverage being flushed, not leverage gearing up.
If 2021 taught me anything, it’s that price crashes without fundamental deterioration are usually leverage cleanses, not trend reversals.
So what kicks off the real rally?
Look, no single domino triggers an alt-season—but some matter more than others:
- The macro tailwind: Even one 25 bps Fed cut signals the liquidity tide is turning. BTC reacts first, ETH follows, smaller caps chase the beta.
- ETH/BTC flip: Watch that ratio. If we reclaim 0.065, money is rotating into ETH risk. The 2021 run began the week ETH/BTC broke that exact level.
- Spot ETF whisper-campaign: Gary Gensler probably isn’t changing his mind tomorrow, but VanEck or Fidelity dropping a revised S-1 could front-run 2026 approvals.
- Killer app chatter: Rollups, EigenLayer restaking, whatever Vitalik demoed at EthCC—narratives matter, even if TVL numbers lag.
Tick those boxes and a 2-3× move off the lows becomes plausible. History doesn’t repeat, but crypto sure loves to rhyme.
Why this matters for your portfolio
If you’re all-in already, congrats—you get front-row seats to the volatility opera. For the rest of us, I’d treat the next few weeks like 2021’s July: keep dry powder, set spot bids below $1,800, and maybe lob a cheeky ladder of perps with tight risk if we wick into the $1,600-1,700 zone.
Could I be dead wrong? Absolutely. Maybe the Fed stays hawkish, maybe an ETF denial nukes confidence, maybe another black-swan hack floors the market. But zooming out to the multi-cycle view I’ve leaned on since 2013, sub-$2k ETH has consistently been a gift, not a trap. I can’t guarantee a 200 % pop by November—nobody can—but I’d bet my last Ledger that five years from now we’ll look back at these prints and laugh at how scared everyone was.
Tangential brain-dump before I let you go
• Remember when everyone mocked “ultrasound money”? That meme aged nicely as BTC’s issuance doubled post-halving while ETH kept burning.
• Keep an eye on LayerZero’s airdrop next week—bridged ETH flows often telegraph where the hot money’s rotating.
• Arthur Hayes just published another spicy blog calling for $5k ETH by Christmas. When the BitMEX wizard and the macro crowd agree, my ears perk up.
• If you’re new here, please, for the love of Satoshi, practice good key management. 2021’s rally minted thousand-aires; 2022’s hacks nuked half of them.
Alright, that’s enough ranting from this grizzled wallet. I’ll be refreshing funding rates and sipping cold brew until the next wick does something interesting. Stay solvent out there, friends.
