Ethereum Price at Risk as UK Regulators Move to Ban $102 Billion DeFi Loan Market
By: bitcoin ethereum news|2025/05/03 16:00:05
0
Share
Ethereum price hits 60-day peaks above $1,860 driven by institutional interest in Bitcoin, UK regulators proposed ban on DeFi loan markets highlights major risks ahead Ethereum (ETH) Taps New 60-Day Peaks as Institutions Amplify Bitcoin Demand Ethereum (ETH) extended its bullish momentum on Friday, surging to a fresh 60-day high above $1,865. The rally comes as institutional demand from Bitcoin ETFs reach historic-peaks. Much of the upside pressure is traced to unprecedented inflows into spot Bitcoin ETFs, which recorded over $4 billion in cumulative acquisitions during nine consecutive days of buying. This development has spread bullish tailwinds towards the broader altcoin sector, with ETH price evidently benefitting indirectly from renewed investor interest on Friday. Further fueling sentiment, MicroStrategy announced plans to raise additional capital for Bitcoin accumulation, reinforcing market expectations for sustained institutional engagement. While Ethereum’s own use case differs, its market value has historically responded positively to macro crypto inflows, as traders anticipate secondary momentum into Layer-1 altcoins. UK Regulators Move to Ban Crypto Loans with Credit Cards The UK’s Financial Conduct Authority (FCA) unveiled a proposed ban on crypto-backed lending, signaling a regulatory shift that could have deep repercussions for decentralized finance (DeFi). The policy targets the growing practice of issuing loans against crypto assets, citing systemic risks to consumer protection and the broader financial system. The proposal follows closed-door consultations with the Bank of England and other global financial regulators. At the heart of the crackdown is concern over under-collateralized loans and opaque decentralized credit systems. The FCA’s framework would prohibit UK-based platforms from offering loans secured by crypto assets, including stablecoins and major tokens like Bitcoin and Ether. The draft legislation is currently open for public feedback, with a 90-day comment window preceding final parliamentary review scheduled for Q3 2025. DeFi Crackdown Could Further Erode Ethereum’s Market Share The FCA’s proposed ban threatens to deliver a significant blow to the DeFi ecosystem—an area where Ethereum remains the dominant platform. As of Friday, total DeFi lending and staking value locked (TVL) reached $101.7 billion, with Ethereum accounting for $51.9 billion, or 52% of total market share. This is notably down from its 71% peak during the 2021 bull market, according to DeFiLlama. Should the UK’s ban proceed, major Ethereum-hosted protocols like Aave, Compound, and Lido may see declining user activity and capital inflow from the region. In particular, UK-based liquidity providers and institutional platforms may reduce exposure to DeFi entirely, weakening the ecosystem’s depth. Staking rewards, which depend heavily on borrowing volume and token utility, are also at risk. Lower lending activity could compress yields, potentially triggering a cascading withdrawal effect across Ethereum’s staking protocols. In this scenario, Ethereum’s overall cryptoccurrency market share could decline further. Ethereum Price Forecast Today: ETH Targets $1,920 as Bullish Structure Strengthens Ethereum price is gradually carving out a bullish structure as it continues to pressed the $1,865 barrier on Friday. The ETH price action has shown resilience in recent sessions, holding firmly above the 20-day exponential moving average at $1,754—a level that has quietly become a foundation for this uptrend. As seen below ETH candles have grown tighter near the top of their daily ranges, suggesting mounting pressure from buyers, even as broader market sentiment remains cautious. The Ethereum price forecast today points to a cautiously optimistic outlook. With the Relative Strength Index rising to 58.02, momentum is building but not yet overextended. The Parabolic SAR has shifted firmly beneath the price since late April, reinforcing the narrative that upward momentum is becoming more entrenched. Meanwhile, the Bollinger Band Percent at 140.12 indicates growing volatility, a common precursor to breakout activity when paired with narrowing consolidation. If Ethereum can push cleanly above the 50-day EMA resistance around $1,858, bulls could find enough conviction to propel prices toward the $1,920 zone. But the structure remains vulnerable to a pullback if this momentum stalls, with $1,754 likely to act as the key support threshold where sentiment could pivot once more. Frequently Asked Questions (FAQs) Ethereum is benefiting from broader crypto market momentum, particularly Bitcoin ETF inflows, which are attracting institutional capital across digital assets. The proposed ban could dent Ethereum’s DeFi dominance by reducing UK-based participation in lending protocols like Aave and Compound. Ethereum is targeting $1,920 as upward momentum builds, though resistance near $1,858 remains a critical level for confirmation of a breakout. ✓ Share: ibrahim Crypto analyst covering derivatives markets, macro trends, technical analysis, and DeFi. His works feature in-depth market insights, price forecasts, and institutional-grade research on digital assets. Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss. Source: https://coingape.com/markets/ethereum-price-at-risk-as-uk-regulators-move-to-ban-102-billion-defi-loan-market/
You may also like

Polymarket vs. Kalshi: The Full Meme War Timeline
The topic itself has become a growth engine, and this "flame war" may be their most effective business strategy.

Consensus Check: What Consensus Was Born at the 2026 First Conference?
Just concluded in Hong Kong, Consensus HK 2026 has set the stage for a new narrative this year.

Resigned in Less Than a Year of Taking Office, Why Did Yet Another Key Figure at the Ethereum Foundation Depart?
The Ethereum Foundation once again finds itself at the crossroads of personnel turmoil.

Russian-Ukrainian War Prediction Market Analysis Report
By analyzing transaction patterns, validate the predictive market as a harbinger of truth in the new media order

Ethereum Foundation Executive Director Resigns, Coinbase Rating Downgrade: What's the Overseas Crypto Community Talking About Today?
What Have Foreigners Been Most Interested in the Last 24 Hours?

Who's at the CFTC Table? A Rebalancing of American Fintech Discourse
What on earth is the CFTC up to?
AI Trading vs Human Crypto Traders: $10,000 Live Trading Battle Results in Munich, Germany (WEEX Hackathon 2026)
Discover how AI trading outperformed human traders in WEEX's live Munich showdown. Learn 3 key strategies from the battle and why AI is changing crypto trading.
Elon Musk's X Money vs. Crypto's Synthetic Dollars: Who Wins the Future of Money?
How do Synthetic Dollars work? This guide explains their strategies, benefits over traditional stablecoins like USDT, and risks every crypto trader must know.

The Israeli military is hunting a mole on Polymarket
「The suspect's behavior has posed a significant operational risk and will be charged with serious security offenses.」

Q4 $667M Net Loss: Coinbase Earnings Report Foreshadows Challenging 2026 for Crypto Industry?
Coinbase reports $1.8B in total revenue in Q4 2025, with a $667M loss leading to a sharp drop in stock price.

BlackRock Buying UNI, What's the Catch?
DeFi has transitioned from "Experimental Finance" to "Infrastructure Finance."

Lost in Hong Kong
When yesterday's glory becomes today's shackles, only the courage to break free from the shackles can win tomorrow.

Gold Plunges Over 4%, Silver Crashes 11%, Stock Market Plummet Triggers Precious Metals Algorithmic Selling Pressure?
An analysis suggests that metal prices experienced a sudden drop due to a suspected algorithmic trading sell-off, leading some investors to unwind their positions in commodities including gold and silver to access liquidity.

Coinbase and Solana make successive moves, Agent economy to become the next big narrative
The new war around the Agent On-chain Economy has begun.

Aave DAO Wins, But the Game Is Not Over
The Aave community has achieved a milestone victory on the topics of revenue and governance, but key disagreements regarding the boundaries of funding, branding, and power remain unresolved

Coinbase Earnings Call, Latest Developments in Aave Tokenomics Debate, What's Trending in the Global Crypto Community Today?
What Was Trending Among Expats in the Last 24 Hours?

ICE, the parent company of the NYSE, Goes All In: Index Futures Contracts and Sentiment Prediction Market Tool
TradFi giants are moving into the crypto market at an unprecedented pace.

On-Chain Options: The Crossroads of DeFi Miners and Traders
An Insurance Policy, a Money Printer
Polymarket vs. Kalshi: The Full Meme War Timeline
The topic itself has become a growth engine, and this "flame war" may be their most effective business strategy.
Consensus Check: What Consensus Was Born at the 2026 First Conference?
Just concluded in Hong Kong, Consensus HK 2026 has set the stage for a new narrative this year.
Resigned in Less Than a Year of Taking Office, Why Did Yet Another Key Figure at the Ethereum Foundation Depart?
The Ethereum Foundation once again finds itself at the crossroads of personnel turmoil.
Russian-Ukrainian War Prediction Market Analysis Report
By analyzing transaction patterns, validate the predictive market as a harbinger of truth in the new media order
Ethereum Foundation Executive Director Resigns, Coinbase Rating Downgrade: What's the Overseas Crypto Community Talking About Today?
What Have Foreigners Been Most Interested in the Last 24 Hours?
Who's at the CFTC Table? A Rebalancing of American Fintech Discourse
What on earth is the CFTC up to?