Ethereum (ETH) investors who opened positions at high price levels have largely run out of purchasing power, according to Chinese on-chain data analyst Murphy, raising concerns about ETH’s ability to stage a strong recovery.
Murphy posted statistical data on social media, revealing that the average cost basis for ETH positions created between January and February 2025 ranged from $3,200 to $3,500. A significant cluster of addresses significantly increased their holdings to $3,475 by accumulating approximately 1.66 million ETH. This group did not buy the dip when ETH dropped to $1,900 and currently hold 1.94 million ETH, reducing their average cost to $3,150.
Meanwhile, addresses that opened positions in mid-February 2025 had entry costs ranging from $2,600 to $2,800. As the price of ETH fell below $2,300, this group began to offload their holdings. Currently, only positions at $2,800 (1 million ETH) and $2,630 (850,000 ETH) remain unchanged.
As ETH continues its downward trend, new demand has weakened significantly, especially as the price has dropped below $2,000. Data suggests that buying interest has almost disappeared at these levels.
Murphy explained that investors who accumulated ETH at higher price points have now exhausted their purchasing power after a series of attempts to reduce their costs on average. The $1,850 price level represents the cost basis for a large group of investors who established positions two years ago. When ETH approaches this level, they tend to buy back previously sold portions to reduce their overall costs, potentially creating a support zone. However, if $1,850 cannot hold, ETH could slide toward $1,600 or even $1,250, where the accumulation from three years ago could provide the last major support, according to the analyst.
According to Murphy, the market recovery depends on rebuilding investor confidence in the long-term value of ETH. Without a renewed consensus, large accumulations at $2,630, $2,800, and $3,150 could act as significant resistance and limit any potential recovery.
*This is not investment advice.
