ETH Holds $2,400 Support Despite 15% Decline Amid Layer-2 Growth

Key Takeaways

ETH maintained crucial support at $2,400 despite a ~15% price drop and significant leveraged liquidations.
Growth in Ethereum’s layer-2 scaling solutions and inflows into spot ETH ETFs underpin renewed investor confidence.

Ether (ETH) faltered in sustaining bullish momentum, briefly dropping ~15% on Friday to $2,440. However, the cryptocurrency demonstrated notable resilience near the $2,450 level, supported by underlying market dynamics.

Eth Futures Premium Reclaims Neutrality

The ETH futures premium briefly turned bearish following the sharp price drop, triggering $277 million in liquidated leveraged long positions over two days. This occurred as ETH prices plunged to $2,440. By Sunday, however, the futures premium recovered above the neutral 5% threshold, signaling a return of confidence in the $2,400 support level as traders adjusted their positions.

Ethereum layer-2 ecosystem surges

The expansion of Ethereum’s layer-2 scaling infrastructure appears to be fueling Ether’s recent price action. This surge coincided with Solana and BNB Smart Chain surpassing Ethereum in decentralized exchange (DEX) trading volumes. Combined activity on Base, Arbitrum, Uniswap, and Polygon has eclipsed Ethereum’s $65.5 billion monthly DEX volume mark.

*ETH 60-day futures annualized premium. Source: Laevitas.ch*

Low base-layer transaction fees remain a persistent issue driving ETH supply growth. Layer-2 rollups mitigate this by offering scalability, enabling new applications. Base’s flagship app, Morpho, exemplifies this, providing infrastructure for collateralized lending and yield generation.

A significant development was Shopify’s June 12 launch of a limited USDC payment rollout on Base blockchain, featuring a 1% cashback incentive. Expected full launch by end-2025, this collaboration highlights Base’s low-cost, secure environment.

Ether derivatives markets display resilience

Despite the price drop below $2,500, ETH options markets indicate sustained professional confidence. In a neutral scenario, the 25% delta skew typically fluctuates between -5% and +5%. Currently, at 4% (as of Sunday), put options are trading slightly less expensive than calls, remaining within the neutral range. This suggests institutional holders, including whales and market makers, haven’t adopted a bearish stance, despite the price pullback.

*30-day decentralized exchange volumes, USD. Source: DefiLlama*

Supporting this confidence is a $830 million net inflow into US-listed Ether exchange-traded funds over the past month. Reduced ETH balances on exchanges (down to 16.31 million ETH, a ~3.6% decline according to Glassnode) are generally interpreted as bullish, indicating reduced selling pressure or staking/long-term holding rather than immediate supply injection. Furthermore, Ethereum’s Total Value Locked (TVL, up 6% to $67.2B) also reflects institutional integration.

*ETH 30-day delta skew (put-call) at Deribit. Source: Laevitas.ch*

Eth’s Trajectory Influenced by Global Factors

Eth’s future path is increasingly influenced by external geopolitical events, particularly tensions in the Middle East and ongoing US trade disputes.

While traders do not anticipate ETH returning to $3,000 immediately, the strength observed in key derivatives markets suggests the $2,400 support zone remains significant.

This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.