Ethereum Price Drops on Low Trading Volume and Regulatory Pressure
- Ether price dropped to a 7-day low of $1,788 due to low trading volume and Chinese prosecutors cracking down on the NFT market.
- Lawmakers in the United Kingdom are claiming that crypto assets should be regulated like gambling due to their high-risk nature.
- The Ethereum sell-off has led to a wave of leveraged liquidations, with over 26,000 traders being liquidated for $56 million.
Reasons Why Ethereum (ETH) Price is Down Today
Liquidations and Low Volume
The Ether sell-off has triggered a wave of Ethereum leveraged liquidations, with 26,158 traders being liquidated to the tune of $56 million on May 17. Trading volume has decreased from its March 11 peak of $24.8 billion to only $1.9 billion as other protocols including Bitcoin BRC-20 standard and Dogecoin DOGE $0.07 DRC-20 standard gain momentum. Some analysts believe Ethereum will struggle to reach and stay above the $1,900 level in the short term.
Regulatory Focus Turns Toward Ether
U.S. regulators are trending toward taking swift action on cryptocurrency regulations, while debate surrounding whether Ether should be classified as a security token continues without clarification from the SEC yet. If Ethereum is deemed a security in the United States, centralized exchanges may be forced to delist it for U.S customers which could have negative impacts on altcoins, DApps and decentralized exchanges built on Ethereum.