Ethereum Network Slumps to 12-Month Low: What the Retail Exodus Means

Bears have pushed Ethereum’s (ETH) price below $2,850 on Thursday, amid a broader market downturn. Retail absence has also pushed Ethereum into a low-activity regime.

But similar conditions in the past have often appeared near structural bottoms.

Ethereum’s Retail Users Have Gone Quiet

According to CryptoQuant’s latest analysis, Ethereum’s network activity has fallen to a one-year low, showing a clear absence of retail participation. Active sending addresses have dropped toward the 170,000 level. In previous instances, this range indicated that retail traders have either exited the market or are unwilling to transact.

The decline often follows extended periods of volatility and corrective price action, which tend to weaken short-term confidence and engagement among smaller participants. From an on-chain perspective, such low activity levels are commonly associated with seller exhaustion, where selling pressure begins to fade, but fresh demand has yet to emerge.

While this environment limits short-term upside, since retail flows usually help drive momentum during early recoveries, it has also frequently identified phases where larger, long-term participants start accumulating ETH quietly.

CryptoQuant explained that price action alone will not be enough to confirm a recovery. Instead, a meaningful signal would come from a steady increase in active sending addresses alongside price stabilization, which indicates returning demand and improving network usage.

If address activity continues to decline or remains stagnant for an extended period, the risk of Ethereum entering a deeper consolidation or demand-destruction phase increases.

Market Remains Cautious

Not everyone is bullish on ETH’s recovery. Crypto analyst Ali Martinez, for one, warned in a recent tweet that if ETH closes December below $2,930, the market could face a sharper decline. Failing to hold this crucial level may push the altcoin down to $2,000, and in a worst-case scenario, even as low as $1,100.

On the institutional side as well, spot Ethereum ETFs saw significant outflows this week as investors reduced exposure amid market uncertainty. On Monday, nearly $225 million left these funds, driven by renewed US equity volatility and unclear global monetary policy. Data compiled by SoSoValue found that Tuesday saw similar selling, while Wednesday’s outflow was smaller, at $22.3 million.

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