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Markus Thielen, research CEO at 10x Research, has cast a spotlight on Ethereum's trajectory, suggesting a potential decline to $2,500. His analysis points to weak fundamentals within the Ethereum network that could not only affect its value but also pose a hindrance to Bitcoin's progress.

Ethereum, often touted as the backbone of decentralized finance (DeFi) and the non-fungible token (NFT) ecosystem, has long been regarded as a cornerstone of the cryptocurrency market. However, in this present cycle, Ethereum remains a basket case. 

According to the 10x researcher, Ethereum was the driving force during the 2020/2021 cycle because it was intended to replace the legacy banking system. NFT minting opened up new avenues for cryptocurrency acceptance, which may have evolved into other personalized papers on the blockchain, resulting in widespread "wallet" adoption. However, the Ethereum developers did not respond quickly enough. 

The inability of Ethereum developers to react quickly in the face of a major opportunity for the ETH ecosystem and a slew of other variables has weighed on Ethereum's fundamentals, casting doubt on its prospects.

According to Thielen, the implications of Ethereum's weak fundamentals extend beyond its ecosystem. Thielen points out a high correlation between Bitcoin and Ethereum, with an R-square of 95%. Ethereum’s weak fundamentals are becoming a roadblock for Bitcoin, preventing large-scale fiat inflows into the cryptocurrency ecosystem, he says. 

Thielen's forecast coincides with a period of increased uncertainty and volatility, with the cryptocurrency market under selling pressure. At the time of writing, ETH has fallen 4.32% in the last 24 hours to $2,902, matching the sell-off in the broader cryptocurrency market.

According to Glassnode, amid the hype and market rally surrounding the approval of the spot Bitcoin ETFs, Bitcoin holders' unrealized profits increased far quicker than those of Ethereum investors. The Bitcoin NUPL metric surpassed 0.5 and reached the euphoria phase three months before the equivalent metric for Ethereum.