Ethereum is approaching a milestone that few investors would welcome: the longest streak of consecutive monthly losses since the crypto winter of 2018.
Since September 2025, ETH has posted six consecutive monthly declines, a period that has driven its price down by about 60% from its August 2025 all-time high of $4,953 to below $2,000.
A losing streak of this length is unusual for a network that is simultaneously posting record transaction activity, and that contrast makes the current phase remarkable.
As a result, the immediate problem is not just that ETH has fallen.
The run suggests the market is reevaluating Ethereum’s value amid strong network usage, but the mechanisms that once supported a simple bullish thesis for ETH are harder to model.
That makes the current downturn different from the collapse of 2018, when the broader crypto market was experiencing an initial coin supply boom and much of the industry was still trying to prove it had lasting product market fit.
Ethereum is a much more mature network in 2026. It has deeper institutional relevance, greater on-chain economic activity, and broader use through tokenization, stablecoins, and layer 2 networks.
Yet the token associated with that system still struggles to hold value.
Bitcoin behaves like the index, ETH like the high beta trade
Broad crypto sell-off sees Bitcoin increasingly acting like the market benchmark, while ETH is trading more like the sector’s high beta expression.
This is important when liquidity decreases and sentiment becomes defensive. ETH’s market depth is smaller than Bitcoin’s, its positioning tends to be more leveraged, and its marginal buyer is more sensitive to shifts in macro risk appetite.
When the market takes less risk, that structure could turn a broad decline in the cryptocurrency into a sharper move in Ethereum, especially when derivatives rather than spot markets lead the way.
This is why ETH’s leverage footprint remains central to that story.
Facts from CoinGlass shows that open interest on ETH futures has fallen 65% from an August 2025 peak of nearly $70 billion to around $24 billion at the time of writing. This drastic decline explains the lack of risk in the market.
Yet it also shows that ETH price is formed in a market where forced positioning changes can dominate. Liquidations, hedging and contract unwinding can overwhelm discretionary buying as traders take on risk.
The options markets in particular have reflected the same tension.
Deribit analyses have shown sharp jumps in short-term implied volatility and a heavily negative skew, the classic sign that a market is paying more for downside protection than for upside exposure.
Practically speaking, traders don’t just expect movement. They pay a premium to keep the movement from getting lower.
That helps explain the market-implied range of outcomes. With seven-day at-the-money implied volatility recently hovering around the high 70% range, the one standard deviation band roughly suggests a move of plus or minus $200 over a week, around $1,950 on the spot.
That works out to about $430 plus or minus over a month and $740 plus or minus over a quarter.
These are not price targets. They are a snapshot of how uncertain the next quarter remains and how broad the market thinks the possible paths have become.
The flow picture hasn’t helped the ETH bulls
While the derivatives market explains how ETH prices move, they don’t fully explain why dips don’t find a more sustainable buyer.
That brings the focus to capital formation, the slower-moving support that determines whether declines attract new money or only trigger temporary rebounds driven by short-covering.
On that front, two signals for ETH have remained weak.
The first is the ETF story.
While daily figures vary, the broader multi-month trend for US-listed Ethereum ETFs has been net redemptions, with the nine funds recording outflows of $2.6 billion over the past four months.
That matters less as a headline about immediate selling pressure than as a statement about institutional persistence.
If ETF flows are not structurally positive, rallies will have to be funded elsewhere. In practice, this often means relying more heavily on the same derivative complex that can increase vulnerability.
At the same time, institutional acquisitions of digital asset treasury companies have slowed significantly, with BitMine being the only major buyer in recent months.
In fact, ETHZilla, another ETH-focused treasury company, has dumped its ETH holdings and focused on tokenized real-world assets.
The second is stablecoin offerings, one of the clearest real-time proxies for crypto-native purchasing power.
In recent months, major stablecoins have experienced a significant slowdown, which has presented challenging opportunities for a broader market recovery.
For context, Tether’s USDT market cap has fallen for two consecutive months, indicating that there has not been a growing amount of new liquidity in the space. Notably, this hasn’t happened since the collapse of Terra’s algorithmic stablecoin of USDT in 2022.
This is important for Ethereum because the strongest bull phases have often coincided with the expansion of purchasing power on the chain.
When the stablecoin base is flat, price action can degenerate into rotations and leverage-driven moves rather than sustained spot accumulation.
In those types of environments, rebounds can happen, but they struggle to sustain themselves.
Ethereum is scaling, but that has complicated the value story
The current downtrend also differs from 2018 because Ethereum’s network is more crowded and its scaling roadmap is showing results.
Facts CryptoQuant shows that the seven-day moving average of daily transactions in Ethereum reached a new high of almost 2.9 million in early February.
The drivers for this milestone include the continued growth of on-chain use cases such as tokenizing real-world assets, as well as a shift to lower-cost execution, which has lowered transaction costs for users. Lower costs and higher throughput are generally a benefit to adoption.
But the scaling up of progress has complicated a valuation framework that many investors leaned on in the post-merger era.
The “ultrasound money” narrative, amplified by EIP-1559 and the move to proof-of-stake, focused on fee burning as a possible way to reduce supply.
This mechanism still operates during periods of high rate pressure, when demand for blockspace rises and rates rise, burn increases and ETH can become net deflationary.
The key point, however, is that this path has become conditional rather than automatic.
When demand is normal, or when activity migrates to cheaper execution environments, fire pressure decreases. The post-Dencun environment illustrates this trade-off. Blob data has made rollups cheaper to use, reducing layer 2 costs and expanding capacity.
For ETH holders, this also means that the base tier may not generate the same fee income under normal circumstances.
Facts from Ultrasound.money has shown periods where ETH issuance exceeds the burn.
That weakens the simplified version of an always deflationary story and forces a more nuanced debate about how Ethereum captures value in an all-out future.
The network can grow as a settlement layer, while the direct monetary situation of the token becomes more difficult to model using analogies that investors understand, such as buybacks or dividends.
A six-month losing streak is useful in that context because it suggests that the market is revaluing the link between ecosystem growth and token value, at a time when macro conditions provide limited support.
What could end the streak?
The next phase for Ethereum likely falls into one of three broad paths.
The first is a capitulation-to-reset outcome. If March 2026 also closes lower, the streak will match the 2018 record and the psychological burden will increase.
In that scenario, ETF redemptions continue, stablecoin supply remains flat, and options skew remains deeply negative, indicating that hedging demand still dominates.
The price then tends to test the bottom of the implied volatility cone, not because Ethereum is broken, but because the market wants a bigger discount before taking risk again.
The second is a long period of chopping and base building. This is the less dramatic, but perhaps more realistic outcome. Leverage continues to flow away, volatility remains high but is starting to stabilize, and ETH is trading in a wide range while macro data remains mixed.
Ethereum can still show healthier application revenue and stronger layer 2 activity in that world. The difference is that the price does not reward it immediately, as it waits for better liquidity conditions.
The third is a liquidity turn. For ETH to experience a more sustainable recovery, it will likely need macroeconomic tailwinds, a combination of easing risk pressures, stabilizing ETF flows, and renewed growth in the purchasing power of stablecoins.
If that happens, the market could see Ethereum’s scaling story differently. Instead of focusing on fee compression, investors could place more weight on Ethereum as a settlement layer for a larger economic footprint.
In that framework, the valuation argument moves from mere combustion to indispensability.
The main takeaway is that Ethereum is not simply a repeat of 2018. The market is testing a new story under pressure.
Ethereum is becoming increasingly useful, but in quiet periods it can also be less clearly monetized through fees than many investors once thought.
That tension, combined with macro-risk appetite and the quality of capital flowing through ETFs, stablecoins and derivatives, will determine whether this series ends as a painful footnote or the start of a longer repricing.