Ethereum's recent decline:

1. Quick overview of the core reasons
1. Deterioration of macro liquidity expectations( main cause): Trump's nomination of Kevin. Woor to be Federal Reserve Chair, his hawkish stance triggered concerns over rate hikes and liquidity tightening; combined with PPI exceeding expectations, the dollar strengthened, and funds flowed from high-volatility cryptocurrencies to safe assets like US Treasuries, directly suppressing ETH prices.
2. Chain reaction of high leverage liquidations( accelerant): Over $2.5 billion liquidated across the entire network on February 1-2, with 420,000 liquidations, over 90% being long positions; large ETH contract liquidations triggered a "downward forced liquidation followed by further decline" death spiral, futures financing rates turned negative, and pessimism intensified.
3. Continuous withdrawal of institutional funds: Bitcoin spot ETF experienced consecutive net outflows, and ETH-related ETFs were similarly under pressure; whales transferred large amounts to exchanges, institutions reduced crypto holdings, and market sentiment was cautious, with low trading activity.
4. Geopolitical and market structure: Tensions between the US and Iran boosted traditional safe-haven assets, cryptocurrencies were viewed as high-risk and sold off; weekend liquidity was thin, high leverage and algorithmic stop-losses amplified declines, creating a stampede.
2. Key data( as of 17:00 on February 2)
Price: Lowest at $2,163, currently around $2,190, over 8% drop in 24 hours; liquidations: over $2.5 billion liquidated across the network in 24 hours, with long positions accounting for over 90%; sentiment: panic index rose above 90, futures financing rates turned negative, with bears dominating