The native token of the blockchain network, Ethereum, has fallen more than 30% during June, dipping below $1,000 on June 30. So far this week, the cryptocurrency has lost nearly 9% of its value, one of its most negative periods since the blockchain platform’s creation in 2015.
Ethereum is a blockchain protocol that expands its use to a wide variety of applications in the digital ecosystem. The Ethereum platform, created by Vitalik Buterin, seeks to be a tool for decentralized and collaborative applications on which smart contracts can be closed.
With more than 121 million tokens circulating, the Ether cryptocurrency managed to position itself as the second most valuable currency in the digital asset market, only below Bitcoin, a single Token being worth above $4,400 at its peak during the month of November 2021.
From 2021 to the present, Ether has lost three-quarters of its value and today the crypto trades below $975 in the market.
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Ethereum falls and so does the cryptocurrency market
Although Ethereum’s protocol was revolutionary in the crypto world, as it requires much less energy to mine tokens and approve transactions than its predecessor, Bitcoin, this innovative feature has not been enough to save Ether from plummeting in the crypto market.
Panic has apparently set in in the Ether community, as since May more than 1 million tokens have been deposited on crypto-investors’ trading platforms seeking to exit the devalued digital currency.
Institutional investors are also limiting their exposure to Ether by withdrawing their capital from mutual funds dedicated to investing in the cryptocurrency, CoinShares noted in its weekly report. Ether has recorded withdrawals during the month of June of $136.9 million. So far in 2022, as much as $450 million has been withdrawn.
Ether’s negative returns joins a host of financial stocks that are in freefall in 2022. In U.S. financial markets, major stock indexes are falling in a hurry as news of a possible recession becomes more plausible.