Ethereum (ETH) fell below the $2,000 mark for the first time in nearly two months, prompting many traders to rush back into “buy the dip” mode, according to blockchain analytics firm Santiment.
However, Santiment warned that this sudden burst of optimism around the pullback could itself be a cautionary signal.
Crowd Optimism Could Signal Further Declines
Santiment explains that when a major token breaks a key psychological level, market participants typically split into two groups: one that panics and exits positions, and another that jumps in aggressively, believing they are getting a bargain. The firm says the latter response appears to be driving current sentiment around Ethereum.
“Retail has erupted with ‘buy the dip’ calls toward $ETH,” Santiment wrote on X, noting that this kind of crowd optimism near a local bottom often precedes additional downside.
The reasoning is that retail crowds frequently misjudge these moments, becoming overly optimistic. Those who buy before panic fully sets in may be entering before the actual price floor forms.
Santiment advised patience, recommending that traders wait for FOMO to fade and for signs of panic among the majority before committing capital. In their words:
“There will be an opportunity to buy Ethereum, but ideally you will want to wait for the majority to cool down their FOMO and begin to show panic. This way, you will be buying while there is true blood in the streets.”
Market data supports a bearish near-term outlook. At the time of writing, ETH is trading around $1,975, down nearly 5% over the past 24 hours and about 8% over the past week. Over the past 30 days, the token has fallen roughly 14%.
ETH remains roughly 60% below its all-time high, which was recorded in August 2025 when the price approached $5,000.
Liquidation data from CoinGlass shows approximately $241 million in ETH positions were liquidated in the last 24 hours, with long positions accounting for about $228 million and short positions around $13 million. These skewed liquidation figures indicate many traders were wrong-footed by expectations of a quick recovery.
Network Progress Isn’t Translating to ETH Price Strength
The price decline comes amid intense debate about Ethereum’s long-term outlook. Bankless co-founder David Hoffman recently said he sold his ETH holdings, arguing that although Ethereum has proven successful as a network, the native token’s path to substantial long-term repricing is uncertain.
Hoffman suggested that Ethereum’s development has disproportionately benefited stablecoins, tokenized assets, and decentralized applications, rather than driving demand for ETH itself—labeling the network more as “a giver, not a taker.”
That perspective highlights a broader market dilemma: while protocol-level adoption and utility can rise, those gains do not always translate directly into immediate price appreciation for the native token. Traders and investors are weighing on-chain progress against macro conditions, market structure, and shifting user behavior when deciding whether ETH’s current dip represents a buying opportunity or a signal to stay cautious.