Clarity Act Rejected, Fed's Additional Rate Hike... Will Ethereum Maintain $2,300?

▲ Ethereum (ETH), decline/AI generated image ©

Ethereum (ETH) has been exposed to a series of short-term negative factors, as the US cryptocurrency market structure bill, the Clarity Act, was rejected, followed by the possibility of additional interest rate hikes by the Fed. However, with decreasing exchange holdings and record-high staking putting pressure on supply, the Realized Price of $2,300 is drawing attention as a key price level that will determine future trends.

According to investment media FXStreet on September 17 (local time), Ethereum continued its weakness after the Clarity Act failed to pass the Senate, trading around $2,388.68, down 3.4% in the last 24 hours. During the same period, the overall cryptocurrency market fell by 4.7%. US-listed spot Ethereum ETFs also recorded their largest outflows since January on Tuesday, when the bill's vote was scrapped. However, selling pressure had already appeared before the vote. According to CryptoQuant, approximately 709,400 ETH flowed into Binance on September 11, marking the largest daily inflow since June. An increase in exchange inflows could indicate a potential increase in sellable volume, but it does not necessarily mean actual sales.

Despite short-term negative factors, the long-term supply structure remains stable. According to CryptoQuant's aggregation, Ethereum holdings on exchanges have fallen to their lowest level since 2016, at 14.6 million ETH, showing a continuous decrease since 2022. Analyst Leon Waidmann analyzed that staked volume is at an all-time high of 43 million ETH, accounting for approximately 35% of the total supply. Funds locked with validators can only be sold after passing through a withdrawal queue, which limits the immediately tradable supply in the market.

Valuation indicators are also noteworthy. According to analyst MorenoDV, Ethereum's Market Value to Realized Value (MVRV) has maintained above 1 for several days after crossing it, and the price also exceeds the realized price of approximately $2,300. He analyzed that if MVRV continues above 1 and ETH maintains above the $2,300 realized price, it could support the scenario that June-July was the bottom of this cycle and the market is moving from a recovery phase to an expansion phase. In contrast, the Coinbase Premium Index was around -0.08, indicating relatively weak US spot demand compared to overseas markets.

Monetary policy has emerged as a new burden. The Fed raised its benchmark interest rate by 0.25 percentage points to 3.75-4.00%, with all 12 voting members approving the hike. Of the 18 Fed officials, 16 expected at least one more rate hike by the end of 2026, and the projected rates were 4.00-4.25% for both the end of this year and the end of 2027. Fed Chairman Kevin Warsh also emphasized that inflation remains high, pushing back against expectations that this hike would be a one-off event. US Treasury yields and the dollar also rose after the interest rate decision and economic outlook announcement.

Ultimately, Ethereum faced the dual burden of a weakened short-term upward catalyst due to the rejection of the Clarity Act and the possibility of further tightening. While decreasing exchange holdings and record-high staking support the supply side, there are no clear signs of demand recovering enough to offset recent selling pressure. The media pointed out that whether ETH can defend its realized price of approximately $2,300 will be the next test as the market adapts to the possibility of restrictive monetary policy continuing longer than expected.

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