Tom Lee predicts a critical Ethereum crash this week

Ethereum ETH $2,946.73 Bridged Ether (StarkGate) 5.77% Market capitalization $78.25 million VOL. 24 hours $2.02 billion may reach a local low as early as this week, Fundstrat co-founder Tom Lee said in a commentary for CNBC. According to him, the current decline is part of a broader correction in the crypto market that began after large-scale liquidations on October 10. Nevertheless, the analyst believes that Ethereum’s investment attractiveness remains stable.

Lee emphasized that Ethereum’s key value lies in its role as a neutral infrastructure for asset tokenization and stablecoin issuance. He recalled that major players, including Larry Fink and BlackRock, are interested in tokenizing assets such as stocks, bonds, and real estate. According to Lee, this requires a blockchain with decentralized management and high reliability, which is exactly what he considers Ethereum to be.

The analyst also noted that the high volatility of cryptocurrencies is not a sign of weakness but reflects the specifics of the technology itself. «The price of Ethereum will naturally fluctuate because crypto assets are extremely volatile. But this is part of the nature of the blockchain,» Li said, adding that the fundamentals remain stable.

Among the factors that could form a «price floor» for Ethereum, Lee mentioned the growth in the value of assets blocked on the network and the ratio of ETH to Bitcoin BTC $88,455.38 Mezo Wrapped BTC 1.65% Market capitalization $43.65 million VOL. 24 hours $2.1 billion . According to him, historically, Ethereum reaches the bottom when the share of blocked assets is around 50%, and this level is almost reached now. The current ETH/BTC ratio is 0.032, which is significantly lower than the average value of the last eight years.

At the time of publication, the price of Ethereum was $ 3,018 and remained above the 100-week exponential average. Lee summarized that the current situation indicates that the asset is undervalued relative to Bitcoin, and fundamental data confirms that it is approaching a market low.