Bitmine's Tom Lee Warns of a Potential Sell-Off in Ethereum. Here's the Most Likely Scenario for ETH.

Cryptocurrency, being a 24/7 global market, is prone to rapid price fluctuations. A recent sell-off in South Korean tech stocks has caused investors to worry about the impact of Chinese competitors in the memory chip market, according to Tom Lee, chairman of Ethereum treasury company Bitmine Immersion Technologies. Lee's company has been holding onto Ethereum since June 2025.

Although the overseas tech sell-off may not have a direct link to Ethereum, it has already triggered forced liquidations, which could lead to a secondary wave of liquidations. Many tech investors in South Korea are also crypto investors, so some might sell their crypto holdings to offset losses from their tech stock investments.

Tom Lee predicts that the short-term pain for Ethereum investors will be brief, as Ethereum's price has stabilized since the Oct. 13 sell-off. However, there's another scenario that worries some: the bursting of the AI bubble. If investors lose confidence in AI, it could lead to a total collapse of AI-related assets, including U.S. tech stocks and those in Asia. This could extend the pain to the global crypto market, rather than just a short-term dip.

Ethereum has fallen 50% from its August 2025 peak and currently trades at $2,450. It's unclear if Ethereum can rebound to the $5,000 level it reached earlier this year. Diversifying one's portfolio is crucial to protect against a global market collapse. Despite Ethereum's current down 50% from its August 2025 high, its status as a financial infrastructure play rather than a pure-tech stock gives it an edge.

Since more crypto trading occurs on offshore exchanges than U.S.-regulated platforms like Coinbase, global events can significantly impact Ethereum's future price even before investors have a chance to react.