ETH falls to a 4-month low despite layer-2 growth cutting fees and boosting tokenization. Recovery may happen with new liquidity, aiming for $3,900. Ether dropped below $3,000 due to sector-wide risk-off sentiment after a 40% correction from the all-time high in August.

Global growth concerns drive crypto downturn, with US shutdown and tariffs impacting markets. Rising costs and energy constraints in data centers affect businesses. ETH leverage demand remains muted for a month, impacting companies like Bitmine Immersion and SharpLink Gaming. Unrealized losses in crypto holdings affect investor interest.

Onchain data shows falling Ethereum activity, lowering demand and raising supply. Ethereum’s burn mechanism needs increased base layer data demand for meaningful impact. TVL on Ethereum network drops to $74 billion, with DEX activity down by 27%. Ethereum faces competition in trading volume despite leading in deposits.

Ethereum’s scaling ecosystem strengthens its lead in RWA tokenization and decentralized stablecoins. Base processing nearly 102 million transactions in the past week shows strong network activity. Ether’s outlook relies on reduced global uncertainty and potential central bank liquidity influx. Ethereum could retest $3,900 with improved market conditions.

Read more at Cointelegraph: ETH Falls Under $3K As BTC Slumps Toward $90K