Ethereum Plunges After $100 Million DeFi Hack Sends Shockwaves Through Crypto Market
Ethereum’s native token Ether (ETH) dropped sharply on Monday, falling as much as 9% and breaking below the crucial $3,600 support level after a major security breach hit one of its decentralized finance (DeFi) protocols.
According to market data, Ether was recently down around 6.6%, trading close to $3,600 — roughly 25% lower than its August peak of $4,885. The sell-off followed reports that Balancer, a DeFi platform built on Ethereum, suffered a cyberattack exceeding $100 million, marking yet another blow to digital asset confidence amid a volatile few weeks.
This incident comes on the heels of several factors weighing on investor sentiment. In mid-October, U.S. President Donald Trump announced plans for heavy tariffs on China’s rare earth exports, prompting a temporary market panic and pushing investors toward safer assets like gold. Although he later softened his stance, the remarks triggered a wave of crypto liquidations as traders reduced leveraged positions.
Adding to the pressure, Federal Reserve Chair Jerome Powell recently warned against premature expectations for interest rate cuts — further cooling risk appetite across global markets.
“These developments have left crypto investors uneasy heading into November,” said Juan Leon, senior strategist at digital asset firm Bitwise. “Despite the volatility, this appears to be a necessary correction that has helped flush out excessive leverage from the market.”
Meanwhile, crypto-related stocks also declined in tandem. Coinbase shares slipped nearly 4%, while MicroStrategy, a Bitcoin-focused firm, edged lower by over 1%.
The Balancers hack adds to growing concerns over DeFi security and market stability — reminding investors that even as blockchain technology advances, vulnerabilities continue to pose real risks for the broader crypto ecosystem.
