An unpopular opinion — by Analyst Benjamin Cowen 

As we navigate the complex landscape of the cryptocurrency market, it’s easy to get swept up in the optimism that surrounds price rallies and new all-time highs. However, taking a step back to analyse historical patterns can often reveal less popular, but potentially more accurate, perspectives. This is the approach Benjamin Cowen takes in his recent analysis of Ethereum’s price action, which has led me to re-examine my own expectations for the coming months. 

The Return to Ethereum’s “Home” Price 

One of the most intriguing aspects of Cowen’s analysis is the idea of Ethereum’s “home” price. This isn’t just a catchy term; it’s a concept rooted in the lower bound of Ethereum’s logarithmic regression trend line. According to Cowen, this lower band acts as a kind of gravitational force that draws the price back over time. Historically, Ethereum has dipped to this level during every major market cycle. Cowen’s data highlights 2016, 2019, and potentially now in 2024 as periods where Ethereum followed this pattern. 

This observation challenges the bullish consensus that Ethereum’s recent gains are sustainable without significant retracements. If history holds true, we may be looking at a return to this lower bound before any meaningful long-term uptrend resumes. 

Why ETH/BTC Matters More Than ETH/USD 

A common pitfall for many traders, myself included, is to fixate on the ETH/USD pair as the ultimate indicator of Ethereum’s market health. However, Cowen makes a compelling case for why the ETH/BTC valuation deserves more attention. The U.S. dollar’s inherent volatility and gradual devaluation can obscure the real story behind market movements. In contrast, the ETH/BTC pair provides a clearer lens through which we can gauge Ethereum’s performance relative to the broader crypto market, and most notably, to Bitcoin itself. 

Cowen’s analysis suggests that Ethereum has yet to reach its bottom on this pairing, and he points out that ETH/USD bottoms tend to lag behind the ETH/BTC pair by several weeks. This insight alone is crucial for those of us trying to time market entries or exits. It tells us that even if we see ETH/BTC starting to stabilize or bounce back, it doesn’t necessarily mean the worst is over for ETH/USD. Instead, there may still be time before we see the final bottom in dollar terms. 

Recurring Cycles and the Double Peak Phenomenon 

One of the most fascinating parts of Cowen’s research is his identification of a recurring pattern in Ethereum’s price action across cycles: the double peak followed by a breakdown. In past cycles, Ethereum has formed two distinct peaks before experiencing a significant decline, which eventually leads to a new support level. This midpoint support zone, which initially acts as a stabilizing point, often breaks down later as the market tests the lower regression trend line. 

This cycle is not just theoretical; it’s grounded in what we’ve seen play out before. In 2016 and 2019, Ethereum followed this pattern almost to a tee. Now, in 2024, the setup looks eerily similar. The first peak has come and gone, and a second smaller peak followed. If the pattern holds, we could be facing another breakdown that drives Ethereum back down to its “home” price. 

The Big Question: How Low Could Ethereum Go? 

The idea of a 70% price decline might sound extreme, but it’s not without precedent. In previous cycles, Ethereum has experienced drops of a similar magnitude during bearish phases. Cowen’s analysis projects that a return to the lower logarithmic regression band could mean a drop of this scale from current prices. It’s a sobering thought, especially for those who entered the market at higher levels or are still holding long positions. 

But it’s not all doom and gloom. Understanding this potential downside allows for better strategic planning. If you’re a long-term investor, a significant decline could be an opportunity rather than a catastrophe. For those of us who remember the brutal bear market of 2018–2019, it was precisely these lower levels that laid the groundwork for the explosive bull run that followed. 

Timing and the Implications for 2025 

One of the key takeaways from Cowen’s analysis is that Ethereum’s path may not just involve a sharp drop followed by an immediate recovery. Instead, he suggests that while a breakdown is likely before the end of the year, there could be a prolonged period of consolidation before any meaningful upward momentum begins. This timeline could push any significant recovery into 2025. 

Why does this matter? Because it means that those hoping for a quick turnaround may be in for disappointment. Patience will be essential, as will an understanding that crypto markets don’t operate on linear timelines. A measured approach, recognizing the potential for a multi-year accumulation phase, could be the best strategy for weathering this period. 

Final Thoughts: Navigating the Path Forward 

Benjamin Cowen’s analysis offers a sobering reminder that past market cycles often rhyme. While it’s tempting to believe that this time could be different, historical data suggests otherwise. Ethereum’s return to its “home” price, the importance of watching the ETH/BTC ratio, and the double peak and breakdown pattern are all signals that should not be ignored. 

This perspective isn’t meant to be bearish for the sake of it. Rather, it’s an attempt to stay grounded in reality and prepare for various outcomes. If Ethereum does indeed test its lower logarithmic regression band and experience a significant drawdown, it won’t be the end of the story. Instead, it could mark the beginning of a new chapter that positions the asset for future growth.