10x Research Highlights Structural Weaknesses in Ethereum
10x Research has identified Ethereum as a potential shorting opportunity for investors seeking to hedge digital asset exposure. Their report highlights structural weaknesses in Ethereum as Bitcoin continues to capture the majority of institutional treasury capital. Ethereum-focused companies are encountering diminishing resources, creating conditions favorable for short positions.
The analysis points to Bitcoin's dominance in attracting institutional investment while Ethereum exhibits vulnerabilities. Digital asset treasury narratives around Ethereum have led institutions to accumulate the token before distributing it to retail investors. This pattern is breaking down amid transparency concerns in private investment in public equity disclosures and uncertain capital flows.
BitMine's Treasury Strategy Faces Disruption
Treasury company BitMine serves as a case study in the report. The strategy enabled institutional investors to acquire Ethereum at par value before selling to retail buyers at premiums. This feedback loop previously drove prices higher but now faces disruption.
Technical Indicators Suggest Potential Price Decline
Technical indicators suggest Ethereum's price could decline sharply if support near $3,000 fails. The report projects potential drops to approximately $2,700 based on chart patterns. Weekly stochastic indicators are flashing topping signals, while a multi-year wedge formation has revealed a false breakout similar to patterns seen in March 2025.
Major Ethereum Holders Identified
Currently, 15 Ethereum-focused digital asset treasury companies hold a combined 4.7 million Ethereum. BitMine holds approximately 3.3 million Ethereum on its balance sheet, making it the largest holder by far. SharpLink follows with about 859,853 Ethereum, while Bit Digital maintains 150,244 Ethereum.
Contrasting Outlooks on Ethereum's Future
Despite recent volatility and waning demand from U.S. spot exchange-traded funds, BitMine chair Tom Lee maintains a bullish outlook. He reiterated last month that Ethereum's price could reach $10,000 this year, arguing the asset has established a solid base since 2021. This optimism contrasts with broader market caution.
Impact of Market Events on Digital Assets
The Oct. 10 crash eliminated approximately $19 billion in crypto positions, marking the largest liquidation event on record. Since that event, Ethereum and the wider digital asset sector have struggled to regain momentum. Traders are losing conviction following the historic sell-off, according to analysts.
Ethereum's Performance and Institutional Preference
Ethereum opened 2025 at $3,285 and recently traded below that level, erasing year-to-date gains. The second-largest cryptocurrency by market capitalization reached an all-time high of $4,946 in late August before falling 31.2%. Current trading levels reflect growing institutional preference for Bitcoin over alternative platforms.
Macroeconomic Factors Influencing Trader Positioning
Federal Reserve Chair Jerome Powell's cooling expectations for a December interest rate cut may be influencing trader positioning. The institutional rotation away from Ethereum creates opportunities for sophisticated investors to profit from anticipated declines while maintaining cryptocurrency market exposure through Bitcoin holdings.