Ether edged below the $2,000 mark on Friday, signaling another potential leg lower for the leading smart contract token. Trading around $1,975, ETH slipped roughly 5% over the past 24 hours, according to TradingView data. The move came as traders weighed weak near-term demand against a backdrop of outflows from spot ETH funds and retreating exchange activity, raising the prospect of a deeper correction in the weeks ahead.

Market participants monitored liquidations and price structure for clues about how much further downside might be in store. Data from Coinglass showed more than $111 million in long Ethereum liquidations as the price pressed lower, underscoring how quickly leverage could unwind in a volatile move. The price action also followed a failure to clear resistance around $2,200 earlier in the week, a bottleneck that had capped any sustained recovery despite long-term bulls arguing for a fundamental case beyond price action.

Key takeaways

• ETH price has shown structural weakness, failing to sustain a move above the $2,000 psychological level and threatening a broader correction.
• Analysts see a risk of further downside toward the $1,750–$1,850 zone if buying interest remains tepid and key technical supports give way.
• Demand trends for ETH remain negative, reinforcing downside pressure even as macro uncertainty persists.
• Spot ETH ETFs and broader Ether-based ETPs have faced persistent outflows, signaling reduced institutional appetite in the near term.

Price action and near-term risk for ETH

After failing to beat back sellers near the $2,200 zone earlier in the week, Ether continued to drift lower, with the daily picture painting a softer short-term trajectory. The break below the critical $2,000 level is noted not only as a round-number psychological barrier but also as a test of longer-term momentum indicators. Analysts have pointed to the 50-day simple moving average near $2,000 as a potential fulcrum; a sustained breach could open the path toward the mid-$1,900s and then into the $1,850–$1,750 corridor that previously acted as a support band in more challenging cycles.

Onur, a trader who commented on social media this week, framed the situation as a tale of waning immediate demand despite constructive, long-horizon narratives. “ETH keeps pressing into the same resistance, but the story sits beneath price action. Even with strong long-term narratives, short-term demand still looks thin,” the analyst wrote, underscoring how a market capable of sustaining a rally requires more than macro optimism.

Another practitioner, CryptoWZRD, offered a bearish read, suggesting ETH could slide further toward the $1,800 area after a close below $2,200. Ted Pillows echoed the sentiment on social channels, calling the Friday move a sign of ongoing weakness and predicting continued downside pressure in the near term. A chart‑driven assessment associated with that view pointed to a potential pullback to the $1,800 level before any meaningful rebound materializes.

Taken together, the setup aligns with a view that a test of fresh demand could be required before ETH could mount a convincing bounce. A referenced analysis from Cointelegraph highlighted that a clean close below the 50-day moving average around $2,000 may pull ETH to the $1,900 zone, with a subsequent drift toward $1,850–$1,750 if selling accelerates. While such targets are not certainties, they reflect a structurally fragile near-term backdrop that traders will be watching in the weeks ahead.

Demand signals and the broader momentum picture

Beyond price, a gauge of demand known as Apparent Demand has shifted negative, reflecting a risk-off posture among market participants. Capriole Investments tracks this metric for Ethereum and reported that the indicator has been in negative territory since March 3, dipping to as low as −58,000 ETH on March 16. The current reading sits at roughly −23,475 ETH, illustrating a partial but not complete improvement from the precipitous declines seen earlier in the month. Negative Apparent Demand suggests that buyers have been less aggressive relative to sellers, a condition that can extend price weakness in the absence of a fundamental catalyst or liquidity-driven relief.

The demand backdrop is reinforced by spot ETH fund flows. Data tracked by SoSoValue shows seven consecutive days of net outflows from spot Ethereum exchange-traded products (ETPs), totaling about $391.8 million. In parallel, global Ether ETPs posted about $27.2 million in outflows last week. Taken together, these figures indicate sustained institutional and fund-level withdrawal of exposure to Ethereum, which can amplify selling pressure when markets navigate a risk-off environment or await clearer catalysts.

The combination of weak near-term demand signals and ongoing fund outflows fits a narrative where ETH could test lower support levels before any substantive rebalancing or accumulation resumes. While the long-term promise of Ethereum’s network and DeFi ecosystem remains, the immediate price psychology remains fragile as traders adjust their risk appetites in response to macro uncertainties.

Institutional flows, ETF dynamics, and what to watch next

From an investor flows perspective, the current pattern suggests an ongoing reassessment of ETH exposure among institutions and professional traders. The outflows from spot ETFs and broader ETPs imply that even as Ether’s network activity and development progress, the market is prioritizing capital preservation over new risk-taking in the current climate. In such environments, reported liquidity dynamics—such as the sizable long liquidations observed during Friday’s session—can dominate short-term price action, even when longer-term fundamentals remain intact.

Market participants should also weigh the interplay between ETH’s on-chain usage, derivatives dynamics, and macro developments. While ETF and ETP outflows can weigh on price, they can also precede periods of renewed interest if catalysts emerge—such as institutional staking activity, improved on-chain metrics, or regulatory clarity that fosters broader participation. Bitmine’s recent move to expand Ethereum staking infrastructure, noted in industry coverage this week, underscores a broader trend toward more institutional-grade exposure to ETH, even if the market’s near-term trajectory remains contested.

In the meantime, traders will likely focus on two anchor points: the psychological $2,000 level and the 50-day moving average around that same vicinity. A sustained dip below these levels could open a fresh wave of risk-off pressure, with the next visible supports in the $1,900 zone and the mid-to-lower $1,800s if selling accelerates. Conversely, any reversal would need to be accompanied by a pickup in demand signals, a cooling in liquidation pressure, and a renewed flow of funds into ETH-based vehicles.

For investors and builders, the unfolding dynamics spotlight a central tension: Ethereum’s technology roadmap and ecosystem benefits remain substantial, but market participation is sensitive to macro cues and fund-level risk tolerances. The current data suggest that near-term ETH price action will be driven more by liquidity and sentiment shifts than by a clear fundamental narrative. That could change quickly if liquidity returns, if staking and institutional products gather traction, or if macro conditions shift in ways that restore risk appetite for non-yielding crypto assets.

Looking ahead, observers should monitor whether demand indicators begin to recover alongside a stabilization in ETF and ETP flows. A sustained uptick in Apparent Demand or a halt to outflows could precede a more constructive price path, especially if price action begins to reflect a more convincing break above existing resistance and a rebuilding of spot and futures premium.

In the near term, however, caution remains warranted as the market tests key support levels and volatility remains elevated. The balance of risk continues to tilt toward further downside unless buyers step in decisively and the flow of institutional capital returns to ETH-focused vehicles.

Readers should keep an eye on evolving liquidity conditions, the pace of outflows or inflows into ETH ETPs, and any new developments in staking infrastructure or regulatory clarity that might tilt sentiment back toward accumulation.

Coinbase rolled out prediction market bets for US-based users in January through a partnership with Kalshi, expanding the exchange’s product scope beyond traditional crypto trading. As March Madness unfolds, however, user feedback has highlighted a growing tension around how aggressively Coinbase is deploying event contracts and push notifications to drive engagement, with some describing the approach as akin to sports betting rather than crypto activity.

The rollout comes amid broader scrutiny of prediction markets in the United States, where regulators, lawmakers, and industry participants are navigating questions about jurisdiction, consumer protection, and potential misuse. Coinbase’s moves sit at the intersection of retail access to complex financial instruments and the evolving regulatory framework that governs how such markets should operate in the US.

Coinbase previously indicated that the Kalshi-backed service would bring a range of outcomes to the platform, from political events to sports results. In December, ahead of the public launch of its prediction market service, Coinbase filed lawsuits against regulators in Connecticut, Illinois and Michigan, arguing that the US Commodity Futures Trading Commission should have exclusive jurisdiction over its prediction markets rather than state gambling authorities. The company did not immediately respond to requests for comment on the user-reported experience during March Madness, as reported by Cointelegraph.

Key takeaways

• Coinbase’s January launch of Kalshi-backed prediction markets brought US users the ability to bet on event outcomes within the Coinbase app, bridging crypto trading with contract-based bets.
• During March Madness, some users reported an influx of push notifications urging bets on college basketball games, prompting criticism that the app is leaning toward sports gambling at a time of industry trust concerns.
• Regulatory tension surrounds prediction markets: state-level lawsuits against operators coexist with the CFTC’s push for exclusive jurisdiction over these markets.
• Legislative activity in Congress has considered curtailing use of prediction markets by politicians, amid concerns about insider information and potential conflicts of interest.
• Industry players are adopting safeguards: Kalshi bans political candidates from trading on election-related markets, while Polymarket has introduced measures to curb manipulation and insider trading.

Push notifications and the March Madness debate

Several users have voiced concerns about the frequency and framing of Coinbase’s market prompts during the March Madness window. A prominent example came from a poster on X who described receiving multiple basketball-related notifications within a single hour, arguing that Coinbase’s emphasis on sports betting reflects a broader shift toward monetizable gambling features on a platform many investors associate with crypto trading. The sentiment echoes a broader critique about trust erosion in the crypto industry and the perceived risk of platform strategies that monetize user engagement through gamified betting.

“I have received three separate notifications about College Basketball from Coinbase in the past hour alone. It is absurd that, amidst arguably the worst collapse in trust in this industry’s history, the largest American CEX has completely pivoted to trying to get their customer base hooked on sports gambling, so that they can extract even more exorbitant fees.”

Industry observers have pushed back with concerns about how such notifications might influence user behavior, especially given the sensitivity around responsible money management and the reliability of on-platform yield sources. John Palmer, co-founder of PartyDAO, voiced a closely related concern, pointing to broader questions about risk controls and the integrity of internal risk management as prediction markets push into mainstream app experiences.

These reactions occur against a backdrop of legal action and regulatory debates that complicate Coinbase’s product strategy. In December, Coinbase argued in court that the CFTC should regulate its prediction markets rather than state gambling authorities. The company’s stance mirrors a broader industry argument that federal-level oversight may provide a clearer, more consistent framework for prediction markets—but it has also drawn pushback from state regulators who view these markets as gambling activities with their own distinct consumer protections requirements.

Regulatory landscape and how it shapes the market

The regulatory environment for prediction markets in the United States is plural and evolving. Prediction market platforms have faced multiple lawsuits from state authorities, asserting various legal and regulatory oversight challenges. At the same time, the federal regulator, the U.S. Commodity Futures Trading Commission, has signaled a preference for exclusive jurisdiction over such markets, creating a jurisdictional dispute that complicates operations for platforms like Coinbase, Kalshi, and Polymarket.

The policy conversation has intensified as lawmakers consider proposals to limit or prohibit certain uses of prediction markets by public officials. Reports describe bills aimed at banning presidents or members of Congress from using these platforms, prompted in part by concerns about insider information and potential conflicts of interest. In response, Kalshi and Polymarket have taken steps to reduce risk: Kalshi announced it would ban political candidates from trading on election-related markets, while Polymarket introduced measures designed to limit manipulation and insider trading.

The headlines around regulation underscore a central tension: prediction markets could offer useful tools for forecasting and hedging, but they also raise concerns about market integrity, consumer protection, and access that policymakers are eager to address. The debate is not only about the legality of the markets themselves but about how they should be designed, who can participate, and what safeguards are necessary to prevent abuse or manipulation.

Industry safeguards, policy shifts, and what to watch next

Beyond high-level regulatory talk, the industry has begun layering practical safeguards into platform rules. Kalshi, for instance, has made an explicit policy choice to bar political candidates from participating in election-related markets, aiming to limit conflicts of interest and insider dynamics. Polymarket has rolled out updates intended to curb manipulation and insider trading, a move that some observers view as essential if prediction markets are to gain broader legitimacy among mainstream users and regulators alike.

For Coinbase, the strategy remains a test of how to merge traditional crypto trading narratives with newer, non-crypto product lines without eroding trust or prompting regulatory backlash. The company’s December lawsuits against state regulators, followed by January market rollout and ongoing user feedback, reflect a high-stakes balancing act: deliver value and diversification to users while navigating a maze of regulatory constraints that could redefine what constitutes a permissible service on a US platform. The tension between innovation and compliance will likely continue to shape both product design and public perception in the months ahead.

Investors, traders, and builders should monitor regulatory developments, particularly any moves by the CFTC or Congress that could standardize or constrain prediction markets in the near term. In parallel, observers will watch for how Coinbase and other operators adjust notification strategies, user onboarding, and risk disclosures to align with evolving expectations around responsible gaming, data privacy, and financial risk management.

The evolving landscape suggests that the next phase of prediction markets in the US will be defined less by a single breakthrough and more by a gradual harmonization of innovation with clear guardrails. Whether Coinbase’s approach will be seen as a model for responsibly integrating event contracts into mainstream financial apps or as a cautionary tale about flashy monetization remains contingent on regulatory clarity, user experience, and demonstrated safeguards against abuse.

Readers should keep an eye on potential policy updates, court decisions, and platform-level changes to betting and disclosure practices as the market seeks a stable path forward amid competing regulatory and commercial interests.

Negative reactions to cryptocurrency exchange Coinbase using its notifications to push bets on event contracts amid the March Madness basketball tournament range from “annoying” to “absurd.”

In January, Coinbase rolled out prediction market bets for US-based users as part of a partnership with Kalshi. However, for some users, the last two months have been seen as an opportunity for the exchange to get people “hooked on sports gambling” using an app that many had devoted to crypto trading.

“I have received three separate notifications about College Basketball from Coinbase in the past *hour* alone,” said X user AvgJoesCrypto on Thursday. “It is absurd that, amidst arguably the worst collapse in trust in this industry’s history, the largest American CEX has completely pivoted to trying to get their customer base hooked on sports gambling, so that they can extract even more exorbitant fees.”

Like sports event contract betting on platforms such as Kalshi and Polymarket, Coinbase Prediction Markets offers US-based users the chance to bet on the outcomes of a variety of events.

Prediction market platforms already face several lawsuits filed by state-level authorities, even as the federal regulator, the US Commodity Futures Trading Commission (CFTC), pushes for “exclusive jurisdiction” over the market.

John Palmer, co-founder of PartyDAO, expressed a similar sentiment over the Coinbase notifications, pushing bets on March Madness games:

“This is essentially encouraging me to gamble. What does that say about the internal philosophy around money management? Can I trust the yield sources on USDC interest, can I trust internal risk management, etc.”

In December, before the launch of its prediction market service, Coinbase filed lawsuits against regulators in Connecticut, Illinois and Michigan. The exchange argued, likely in anticipation of its prediction market launch, that the CFTC, not state-level gambling authorities, should regulate the platform.

Cointelegraph contacted Coinbase for comment on the user complaints, but had not received a response at the time of publication.

Related: Coinbase launches token-backed down payments for Fannie Mae loans

Congress seeks to ban politicians from using prediction markets amid insider information allegations

Amid user feedback and state-level lawsuits, many US lawmakers have also been calling for legislation to address issues in prediction markets. Allegations of someone in government using Polymarket to profit from a bet on the removal of Venezuelan President Nicolás Maduro have led to bills seeking to ban any US President or member of Congress from using the platforms.

Both Kalshi and Polymarket have introduced separate policies to curb insider trading. Kalshi said it would ban political candidates from trading on event contracts related to their campaigns, and Polymarket introduced measures to limit easily manipulated or ethically sensitive markets.

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