Ethereum risks dropping another 25% against Bitcoin as DeFi contagion fears spread.
The ETH/BTC fell by 2.5% to 0.0586 on June 10. The pair's downside move came as a part of a correction that had started a day before when it reached a local peak of 0.0598, hinting at weaker bullish sentiment despiteInterestingly, the selloff occurred near ETH/BTC's 50-4H exponential moving average around 0.06. This technical resistance has been capping the pair's bullish attempts since May 12, as shown in the chart above.
Several DeFi platforms that have staked Ether in Ethereum's PoS smart contract will not be able to access their funds. Thus, they risk running into ETH liquidation troubles as they attempt to pay back their stakeholders. That could prompt these DeFi platforms to sell their existing stETH holdings for ETH. Meanwhile, if they run out of stETH, the selloff pressure risks shifting to their other holdings, including ETH.More importantly, this would consume 25% of the remaining ETH liquidity in the pool. Swissborg also contributes a few thousand Eth to this pool… 6/
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