Ethereum Fell Below $2,000 for the First Time Since August While Staking Hit an All-Time High of 36%. Why Are Holders Locking Up More ETH? - 24/7 Wall St.

Ethereum (ETH) fell below $2,000 today for the first time since August, trading at $1,999 as of 10:14 a.m. ET, down 3.6% over the past 24 hours. The cryptocurrency dipped as low as $1,981 during the session, with its last similar low occurring on August 19 when it reached $1,905. ETH now trades 59.6% below its all-time high of $4,946, reached on August 24, 2025.

Market Sell-Off Drives Decline

The price decline was part of a widespread cryptocurrency sell-off. Bitcoin fell 3.6% to $71,285, while Solana dropped 4.7% to $80.73 over the same 24-hour period. For Ethereum, continued selling from fund investors and options dealers' hedging drove the decline.

On November 11, spot Ethereum ETFs experienced net outflows of $145 million, with the iShares Ethereum Trust (NASDAQ:ETHA) responsible for $130 million of that outflow. When investors withdraw money, these ETFs typically sell ETH, increasing market supply.

Options trading added to the selling pressure, with Coinbase Markets estimating a $589 million short-gamma pocket near $1,980. "Short gamma" refers to how options dealers hedge their positions by selling ETH when prices fall, which can amplify price drops. ETH hit its session low during the busiest trading hour, right at the edge of that cluster.

Staking Hits Record High

Despite the price decline, more holders are staking their ETH. The staking ratio, indicating the percentage of all ETH deposited with validators to earn rewards, has climbed to 36.3%, according to data from Token Terminal. This suggests strong conviction among existing holders.

Some of the newest stakers are investment funds. The Grayscale Ethereum Staking Mini ETF (NYSEARCA:ETH) stakes the ETH it holds, letting investors collect rewards without running a validator. Funds like Grayscale's have grown more comfortable staking since the SEC clarified its staking rules.

Treasury firms—public companies that keep cryptocurrency on their balance sheets—are also staking ETH. Bit Digital (NASDAQ:BTBT) reported holding about 163,726 ETH on September 30 and liquid-staked 73,683 ETH during the quarter. However, staked ETH isn't easily sellable, as holders must join an exit queue that grows longer when many try to leave simultaneously.

Price Recovery Uncertain

The high staking ratio alone probably won't stabilize Ethereum's price unless new buyers emerge. ETH trades below its 20-day average of $2,257, its 50-day average of $2,443, and its 200-day average of $2,151, indicating sellers control the market on every time frame.

ETH has fallen harder than Bitcoin, dropping 8.2% this week compared to Bitcoin's 3.1% decline and Solana's 6.8% drop. Over the past month, ETH declined 17.8%, against Bitcoin's 11.4% drop and Solana's 22.1% fall. Bitcoin's larger base of ETF and corporate buyers explains most of ETH's sharper decline.

For prices to recover, the market needs fresh buyers, and ETF flows are the clearest sign of whether they're returning. If spot Ethereum ETFs see net inflows and ETH closes above its 200-day average of $2,151, the drop below $2,000 was probably a short-lived washout. After a daily close below the $1,980 hedging cluster, dealers could add more selling pressure.