Fundstrat Head of Research Tom Lee Predicts Ethereum Will Rebound Quickly After Recent 37 Percent Price Decline in Global Crypto Markets

Ethereum has experienced another turbulent week, with prices dropping sharply and investors growing uneasy.

Yet according to Tom Lee, head of research at Fundstrat, Ether may be closer to a bottom than many think.

Speaking at a Hong Kong conference on Wednesday, Lee reminded traders that Ethereum has a history of bouncing back quickly after steep declines.

“Since 2018, Ethereum has fallen more than 50% eight separate times,” Lee explained.

“But eight out of eight times, it recovered fully — almost as fast as it fell.

Nothing has really changed this time.”

The Numbers Behind the Decline

Ether’s recent slide has been dramatic. From its highs above $2,000, the asset plunged 37% in just 30 days, hitting $1,760 on February 6 — dangerously close to its 2025 low of just over $1,400.

Analysts like Tom DeMark have suggested that the $1,890 price level could act as a bottom, although it might require a brief “undercut” test to confirm.

Lee described this potential low as a “perfected bottom,” pointing to previous instances in 2018, 2022, and April 2025, when similar falls were followed by V-shaped recoveries.

“You don’t really have to worry about the bottom,” he said.

“If you’ve already seen a decline, you should be thinking about opportunities here instead of selling.”

Staking Demand Reaches Record Levels

Despite the recent market turbulence, Ethereum staking continues to attract massive interest.

The wait time to enter staking is currently 71 days, the longest on record, with 4 million ETH queued in validators.

In addition, 30.3% of the total supply, or 36.7 million ETH, is staked, representing a significant reduction in circulating supply.

Analyst “Milk Road” commented on the implications: “One-third of all ETH is now illiquid, earning a modest 2.83% APR.

That’s not sexy yield by crypto standards. Yet people are lining up anyway.

When people lock up $74 billion during a price dip, they’re not speculating — they’re settling in.”

This ongoing staking frenzy is creating a supply bottleneck that could support prices once broader market sentiment shifts.

Historical Patterns Suggest a V-Shaped Recovery

Looking at Ethereum’s history, sharp drawdowns have often been followed by equally sharp rebounds.

The 64% drop between January and March last year is one such example, reinforcing Lee’s argument that Ether’s current decline may represent another opportunity rather than a catastrophe.

Lee’s confidence is grounded in pattern recognition: all eight significant declines since 2018 led to recoveries, often forming the classic V-shaped bottom favored by technical analysts.

If history repeats itself, traders may soon see Ether climb back toward previous levels, though volatility is expected to remain high.

What’s Next?

Investors will be closely watching the $1,890 to $1,900 range for signs of a confirmed bottom.

At the same time, the record staking activity suggests long-term confidence in Ethereum, despite short-term price swings.

Traders may look to balance risk by combining staking with selective buying during dips, while analysts will track whether the V-shaped pattern holds this time.

With ETH’s illiquid supply at an all-time high and historical recoveries providing precedent, the next few weeks could determine whether Ethereum embarks on another rapid rebound or faces further sideways pressure.

Summary

Ethereum has faced another steep decline, falling 37% over the past month to near $1,760.

Fundstrat’s Tom Lee predicts a V-shaped recovery based on eight previous declines since 2018, all of which rebounded fully.

Despite price drops, staking demand is at record highs, with 36.7 million ETH locked and 71-day wait times to enter validators, significantly reducing liquid supply.

Investors are watching key support levels near $1,890, balancing short-term volatility with long-term staking confidence.