ETH Market Turmoil: Market Storm Triggered by On-Chain Security Incidents and Macroeconomic Policy Shocks

🚀 Event Review

Recently, the ETH market has experienced rare and dramatic volatility. On the news front, expectations of a US Federal Reserve interest rate cut have strengthened, economic data releases have been delayed, and policy uncertainty has continued to intensify market sentiment. Meanwhile, frequent on-chain security incidents have occurred—for example, the ZEROBASE frontend was hacked, tricking users into granting erroneous authorizations and resulting in the theft of some USDT funds. In addition, whale accounts (such as "Brother Maji" and others) saw their long positions forcibly liquidated, causing panic to spread rapidly throughout the market. Many investors reduced their positions and adopted a wait-and-see attitude, directly driving ETH prices to plummet sharply in a short period of time.

⏱️ Timeline

• 22:53: The market learned that senior officials expect rate cuts to continue into 2026, which exacerbated liquidity tensions and panic sentiment.
• 22:59: An on-chain security incident broke out, with the ZEROBASE frontend being hacked, exposing some user funds to risk and raising concerns about on-chain security.
• 23:14: Officials further expressed a tightening policy stance, deepening market uncertainty about the macro environment.
• 23:16: ETH price broke through the $3,200 mark, drawing market attention to asset pressure signals.
• 23:20: Within 15 minutes, ETH price plummeted from around $3,207 to $3,131, a drop of 2.40%, intensifying panic selling.
• 23:41: News emerged that some large ETH whale long positions were close to forced liquidation, causing a sudden increase in selling pressure.
• 23:55: More large ETH long positions were liquidated in succession, further shaking market confidence.
• 00:21: Amid continued volatility, ETH price fell further from around $3,074 to $3,041, a decline of about 1.06%.
• 00:22: Market sentiment briefly stabilized, with ETH price rebounding slightly to $3,049.37 and volatility easing.

🔍 Cause Analysis

Macroeconomic Policy Adjustments and Liquidity Tightening:
The Federal Reserve's ongoing rate cut expectations, delayed release of key economic data, and ambiguous statements from senior officials regarding future interest rate trends have caused investors to lose confidence in global liquidity. Funds have flowed out of risk assets, increasing downward pressure on digital currencies such as ETH.

On-chain Security Incidents and Whale Liquidation Effects:
Recently, a series of on-chain security incidents have occurred, with the ZEROBASE frontend attack raising doubts among investors about the protection of on-chain assets. At the same time, whale accounts faced liquidation due to excessive positions, triggering a chain reaction and a wave of panic selling that swept through the market. The combination of these two major factors directly pushed ETH prices to new lows.

📊 Technical Analysis

This section is based on analysis of the ETH/USDT Binance USDT perpetual contract 45-minute candlestick data:

• Bollinger Bands Trend: After a squeeze, the market price broke below the Bollinger Bands and ran along the lower band, strongly signaling a bearish trend.
• KDJ Indicator: Shows clear divergence, with momentum gradually weakening and the market tending toward weakness.
• OBV Indicator: Continues to break below previous lows, indicating that selling pressure is steadily increasing.
• Abnormal Trading Volume: During the price decline, trading volume surged by 423.40%, clearly indicating panic selling; current trading volume is significantly higher than the recent average, showing abnormal market activity.
• Candlestick Patterns and Moving Average Arrangement: The "Three Black Crows" pattern is evident (multiple consecutive bearish candlesticks with each closing at a new low), MA5, MA10, and MA20 are arranged in a bearish formation, and the MACD histogram continues to decline. Although the RSI is in the oversold region, suggesting a possible short-term technical rebound, the overall downward trend still dominates the market.

🔮 Market Outlook

With multiple factors at play, the current ETH market remains full of uncertainty. Investors should focus on the following aspects in the future:

• Macroeconomic Policy Developments: The direction of Federal Reserve policy and the release of key economic data will directly affect market liquidity and investor sentiment.
• On-chain Risk Monitoring: With frequent security incidents in the crypto asset ecosystem, any recurrence of similar vulnerabilities or hacker attacks could trigger another wave of market panic.
• Whale Movements and Institutional Position Changes: Adjustments in whale accounts' positions and forced liquidations are important barometers of market sentiment; any further liquidation news could trigger even greater volatility.
• Technical Indicator Monitoring: Although the RSI indicates oversold conditions and the possibility of a short-term rebound, the overall technical outlook remains bearish. Whether key support levels can hold will be crucial in determining if the market continues to decline.

Overall, against the backdrop of macro policy uncertainty and compounded on-chain security risks, ETH may continue to consolidate in the short term. Investors are advised to remain cautious, strictly control their positions, pay attention to key support levels and policy news, manage risk carefully, and wait for market volatility to stabilize before making further moves.

📌 Conclusion

The recent sharp volatility in ETH is the result of multiple factors fermenting together. On the macro side, expectations of rate cuts and liquidity tightening, combined with on-chain security incidents and whale liquidation effects, have made market sentiment instantly fragile. Although technical indicators show some oversold signals that may trigger a short-term rebound, the downward trend still dominates. Investors should closely monitor policy and on-chain developments, adjust positions rationally, guard against sudden risks, and wait for the market storm to pass before making rational decisions.