Ethereum (ETH) loses critical support at $3K as the price dips 20% 

YEREVAN (CoinChapter.com) – The price of Ethereum (ETH), the world’s second-largest cryptocurrency, continues to fall. Led by Bitcoin (BTC), which once again fell below the $40,000 mark, the latest price saw ETH lose vital support at $3000. The latest dip in price comes after the crypto markets suffered a setback on Monday morning, fueled by the fact that it was Tax Day in the United States (US). While BTC shed over 4%, ETH registered losses as high as 6% in the past 24 hours. 

Meme tokens Dogecoin (DOGE) and its knockoff Shiba Inu (SHIB) joined the list, shedding about 7% and 8% respectively. 

According to data available on CoinMarketCap, Ethereum (ETH) has lost 20% since April 3 when it traded for as high as $3,580. At the time of writing, ETH exchanges hands at a little over $2,900 per token. 

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What caused Ethereum (ETH) to drop in value? 

As already stated, April has been rather harsh on the cryptocurrency industry, sending the prices of major tokens tumbling. However, while ETH is not immune to market forces, several other factors have contributed to the drop in its value.

As it was tax day on Monday, many traders in the US could have dumped a chunk of their ETH holdings to pay off taxes, sending bearish signals in the markets. In addition, the news of the DeFi protocol Beanstalk hack, which resulted in a $182 million loss, has also had its toll on the Ethereum price. Beanstalk is a stablecoin credit protocol built on the Ethereum network. Its native token, the BEAN, also plunged over 80% as a result.

Moreover, Ethereum Foundation member Tim Beiko tweeted last week about another delay in the much-anticipated transition to Proof-of-Stake (POS). Dubbed ‘Merge’, the transition was due in June. However, the company has disappointed investors yet again. 

While Beiko did not give an exact date or even a rough estimate of the shift to POS, he did claim users don’t have to wait for long as they are on the last day of Ethereum Proof of Work (POW). 

However, such claims hold little value to investors as co-founder and CEO Vitalik Buterin has been promising the shift since 2015. 

To add to Ethereum’s voes, the number of new addresses has seen a steep decline, according to data available on Glassnode Studio. Such a drop indicates that users are losing interest in the platform and are shifting to its competitors.

Ethereum (ETH) needs the bulls to rally behind it at the $3000 support mark to prevent a further drop to $2500 or below.