Author: Marcel Pechman, CoinTelegraph; Translated by: Tao Zhu, Golden Finance

ETH suffered a heavy blow on February 3 and has been difficult to maintain its level above $2,800 since then. Ethereum has fallen by 24.5% over the past 30 days, while cryptocurrency market capitalization has fallen by 10% over the same period. This performance disappointed investors, and some began to question whether ETH had enough momentum to return to the bullish zone.

ETH Futures market currently shows that professional traders have the lowest level in more than a month. This development has raised concerns about whether Ethereum can rebound to $3,400 in the near term.

ETH The long-to-short ratio of top traders. Source: CoinGlass

Higher long-to-short ratios usually indicate traders tend to be long (buy) positions, while lower ratios indicate traders favor short (sell) contracts. Currently, Binance’s top ETH traders report a long-to-short ratio of 3.3 times, well below the previous two-week average of 4.4 times. At OKX, the ratio is 1.2 times, while the two-week average is 2.2 times.

Some of the reason for Ethereum's recent underperformance can be attributed to increased competition. However, Ethereum's currency and ongoing scalability disputes are also one of the reasons.

Ethereum supply has grown at an annualized rate of 0.5% over the past 30 days. This trend reflects low demand for blockchain space and is driven by the adoption of layer 2 scaling solutions.

The Ethereum Foundation has been strongly criticized for its limited involvement in several key ecosystem projects. Some long-time developers have publicly expressed their dissatisfaction, prompting Ethereum co-founder Vitalik Buterin to claim his sole power to the Ethereum Foundation on January 21.

On the positive side, the inflow of spot ETH exchange-traded funds (ETFs) and the recent ETH purchases by World Liberty Financial indicate that buyers are still interested. Net inflows of U.S. spot Ethereum ETFs have been $487 million since January 30, the exact opposite of the $147 million net outflows in the previous four trading days.

On January 31, World Liberty Financial, a tokenized digital asset project backed by the Trump family, acquired another $10 million worth of Ethereum, according to Arkham Intelligence. As of February 5, the company's holdings reached 66,239ETH, worth $182 million, is the largest holdings, surpassing Wrapped Bitcoin (WBTC) and other altcoins.

To determine whether whales and market makers are bearish on Ethereum, analysts should look at the ETF monthly futures market. These contracts are typically traded between 5% and 10% higher than the spot market to make up for longer settlement periods.

Ethereum 2-month futures annualized premium. Source: Laevitas.ch

The Ethereum derivatives market reinforces this sentiment, with the premium dropping to 7% from 10% on February 2. Although still in the neutral range, professional traders have less demand for leveraged long positions. More notably, even during the February 3 crash, the ETH futures premium remained above the 5% threshold of the bear market.

ETH derivatives market has no clear evidence that whales have turned bearish or abandoned hopes of further bullish momentum. Meanwhile, intensified competition from Solana and Hyperliquid has led investors to reevaluate Ether's upside potential. Investors also don’t seem willing to increase their bullish positions before the upcoming “Pectra” upgrade, as its direct benefits for average users are still uncertain.

Ultimately, given Ethereum’s leadership in total lock-in value (TVL) and growing institutional demand, the current $2,800 price seems to provide a reasonable entry point. The $3,400 level can be recovered depends on the clearer interests of ETH stakeholders and long-term investors.