ETHUSD – Daily Chart
Ethereum and other altcoins are at risk from a move to safe havens with the coin falling through previous support at $2,174.
Credit spreads have reached their highest levels since August 2024, coinciding with recent market events. The IEI/HYG ratio, which is used as an indicator for credit spreads, showed its sharpest spike since the March 2023 Silicon Valley Bank crisis.
Historically, Bitcoin and other risk assets have fallen during periods of sharp credit spread expansions. The Silicon Valley bank fallout drove BTC to lows below $20,000 at the time.
Markets have been on edge since the US installed high tariffs on China and other trading partners. A lifting of broader tariffs for 90 days has eased some fears but there is still tension between the US and China-the two largest economies in the world.
Crypto ETFs have suffered with the recent market panic as worried investors take their cash away from speculative plays.
The US Treasury Secretary Scott Bessent said last week that he doesn’t see any systemic issues with the bond market amid the recent deleveraging in the sector. He also said that any Chinese dumping of US Treasurys would hurt its plan for a cheaper currency.
China and Japan have been selling bonds in response to the trade tensions and that is stressing the market.
Last week saw outflows of $795 million across crypto funds, including $751 million from Bitcoin ETFs and nearly $38 million from Ethereum. XRP managed to attract inflows during the sell-off after the recent SEC court case ended. Ethereum has not been active with any product enhancements and investors have taken some money off the table.
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