According to the latest market data, Ethereum indeed experienced a significant decline on the morning of December 13, 2025, plunging rapidly from a high of approximately $3,235 to a low of $3,060, a decline of about 4%.

This change occurred between the evening of December 12 and the early morning of December 13, Beijing time, alongside a broader cryptocurrency market correction, with Bitcoin simultaneously dropping below the $90,000 mark, resulting in a loss of over $50 billion in market value within 24 hours across the entire market.

The following analysis is based on reliable sources (such as CoinDesk, Glassnode, and Farside Investors data) and focuses on the most accurate triggering factors and negative news.

I prioritized using quantitative indicators (such as liquidation amounts, outflows from exchange-traded funds, and changes in positions) to support my conclusions, avoiding subjective speculation.

1. Main reasons for the crash:

Multiple leveraged liquidations compounded by macro pressure.

This flash crash of Ethereum is not an isolated incident but a short-term plunge driven by a chain reaction of leveraged trading liquidations, compounded by macroeconomic bearishness.

Core data is as follows:

In the past 24 hours, the total liquidation amount across the crypto market exceeded $514 million, with Ethereum-related long positions accounting for about 30% (approximately $150 million).

This directly caused the price to plummet from $3,208 (the high point on the evening of December 12) to $3,060 (the low point in the early hours of the 13th). Liquidations primarily stemmed from the forced liquidation of highly leveraged futures contracts, such as on platforms like Binance and Bybit, where Ethereum perpetual contract long liquidations surged by 150%.

Glassnode data shows that long-term holders accelerated selling in this wave, reaching the fastest pace since 2021, releasing approximately 50,000 Ethereum supply pressure.

The U.S. spot Ethereum exchange-traded fund has seen a cumulative net outflow of $1.4 billion since the end of October, with a single-day outflow of up to $260 million on December 12 (a new high for this month).

BlackRock's Ethereum product saw slight inflows, but institutional products like Grayscale dominated the redemption tide.

This reflects that institutional investors turned to cash during market weakness, similar to the bear market pattern in 2022, further breaking technical support levels (the psychological level of $3,200).

Macro triggers stem from the Federal Reserve's hawkish signals:

On December 10, although the Federal Reserve meeting lowered rates by 25 basis points, Chairman Powell emphasized that 'further rate cuts in December are not a certainty' and warned that high rates could trigger some economic recession.

This shattered the market's fantasy of easing expectations in 2025, resulting in a broad sell-off of risk assets.

Ethereum, as a highly volatile asset, has declined 1.5 times more than Bitcoin (which only fell 2.4% to $90,250).

Additionally, the U.S. government shutdown incident (though it has ended) exacerbated liquidity tightening, causing simultaneous declines in the stock and bond markets, further transmitting to cryptocurrencies.

Technical confirmation: The Ethereum daily chart shows that the price has fallen below the 21-day and 50-day moving averages (approximately $3,300 to $3,400), testing the negative 0.5 standard deviation market cap deviation band (support at $2,820 to $2,830).

If it breaks down, it may further test $2,500, but the current relative strength index is oversold (below 30), suggesting short-term rebound potential.

2. News-related bearishness: Vulnerabilities in decentralized finance combined with regulatory clouds dominate.

Yes, several clear bearish news items have emerged in the past 48 hours, which directly or indirectly amplified market panic. Here are the most relevant (in reverse chronological order):

Yearn Finance vulnerability incident (December 12): The decentralized finance protocol Yearn Finance was hacked, resulting in a loss of approximately $20 million in Ethereum-related assets (reported by CoinDesk). This triggered a chain panic, rapidly dismantling market leveraged positions, leading to an additional $600 million in liquidations. Following the incident, active addresses on the Ethereum network and transaction fee revenue plummeted by 40%, highlighting the fragility of the decentralized finance ecosystem.

Aftershocks from the Federal Reserve's hawkish remarks (December 10 to 12): Powell warned that 'some parts of the economy have entered recession' and downplayed expectations for rate cuts in 2025. This led to a 5% reduction in the overall cryptocurrency market value, with Ethereum, as the 'king of smart contracts,' being hit hardest. Several media outlets (such as Economic Times) pointed out that a similar decentralized finance hacking incident in early November (with losses exceeding $1 billion) had already sown the seeds of trouble, further undermining investor confidence.

Broader market bearishness: On December 12, Solana and Dogecoin fell 5.8% and 5.5% respectively, reflecting overall weakness in alternative coins. Ripple dropped 8.6% over 7 days, partly due to regulatory uncertainty (the SEC may strengthen scrutiny of decentralized finance). Furthermore, Ethereum's monthly active addresses decreased by 15% month-on-month, and transaction fee revenue fell to a low for 2024, indicating a decline in ecological usage.

Overall, this crash is the result of short-term leveraged squeezes compounded by medium-term macro concerns, rather than a fundamental collapse of Ethereum (network upgrades like Dencun still support long-term value). If inflows into exchange-traded funds rebound or the Federal Reserve shifts to a dovish stance, prices may retest $3,300.

However, if the current support level ($3,000) breaks, further declines to $2,800 should be watched for.

It is recommended to monitor liquidation data and the flow of exchange-traded funds for real-time updates.