Ethereum, Hit by This Year's Biggest Hack, Is Even the $2,200 Support Level Collapsing?

▲ Ethereum (ETH) / ChatGPT generated image ©

Ethereum (ETH), whose ecosystem-wide trust has been severely shaken by this year's largest decentralized finance (DeFi) hacking incident, is facing intense selling pressure, putting its price defense on high alert.

According to CoinMarketCap, a cryptocurrency market data aggregator, as of April 20 (local time), Ethereum is trading at $2,278.25, down 3.25% over the past 24 hours. This decline is particularly significant within the generally weak virtual asset market, with a large-scale security incident on the KelpDAO cross-chain bridge identified as the key reason for the sudden freeze in investor sentiment.

According to CryptoBriefing, this incident is the largest decentralized finance hack to occur in 2026, with a staggering $290 million stolen from KelpDAO. This shock instantly evaporated $10.5 billion from the total assets deposited in decentralized finance. As the damage spread to over 20 blockchains, including Ethereum Layer 2, Aave suspended the rETH market due to concerns about bad debt, and Ethereum's steadfast core value as a secure settlement layer was undermined, leading to a loss of market trust.

Excessive leverage liquidations and capital shifts in the derivatives market also significantly amplified the decline. Analysis of social data revealed extreme speculative betting in the market, with one investor taking a $16.2 million long position with 25x leverage. Currently, the average funding rate has turned negative, creating a bias where short sellers pay buyers, making them targets for cascading forced liquidations. Concurrently, Bitcoin dominance surged to 59.34%, indicating a clear defensive flow of capital rapidly moving from altcoins to safer assets.

From a technical perspective, Ethereum is currently testing a critical support zone between its recent low of $2,275.65 and the psychological defense line of $2,300. With the 7-day Relative Strength Index (RSI) at 20.15, indicating an extremely oversold condition, a successful defense of this support line could lead to a temporary relief rally or consolidation. However, the overall trend structure itself has been significantly weakened, and the short-term market outlook still leans towards downward pressure.

In conclusion, this sharp decline is a complex result of the major hacking incident that shook the ecosystem, coupled with cascading leverage liquidations and risk-off sentiment. If the $2,275 support level breaks, there is a risk of a massive sell-off, pushing the price rapidly down to the next Fibonacci extension level of $2,200. Therefore, it is crucial to closely monitor further announcements from major decentralized finance protocols and the damage recovery process for the time being.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*