Ethereum has fallen to its lowest level in more than two months, underperforming Bitcoin sharply as worries about tougher US crypto regulation and a major exchange security breach weighed on digital assets.

Ether dropped about 5% in late Sunday trading to $2,223, its lowest since August, while bitcoin fell more than 2% to $73,708, also its weakest since August. Ethereum was trading near $2,122 on Monday, down about 5% over 24 hours, and has now fallen roughly 21% over the past month.

ETH/BTC ratio at lowest since July

Ethereum fell more than three times as far as bitcoin on Sunday, sending the ETH/BTC ratio to 0.02844, its lowest close since 12 July. The ratio briefly broke above a key technical level on 4 November before giving the gain back, and ether closed below its 200-day moving average for the first time since August.

The slide triggered heavy forced selling. More than $500 million in ether long positions were liquidated over 24 hours, accounting for about half of the $1.1 billion in crypto liquidations across the market. Total crypto market capitalisation fell about 4.5% to near $2.51 trillion.

ETF investors keep pulling money out

Institutional demand also looks fragile. US spot bitcoin exchange-traded funds recorded about $1.28 billion in net outflows in the week to 6 November, including $411.9 million on 6 November alone. US spot Ethereum ETFs lost $365.2 million over the same week, adding to the pressure on ether.

Bitcoin had jumped above $80,000 after the US midterm elections, then reversed course. On Thursday 5 November, a sell-off in chip and AI stocks dragged the Nasdaq lower, and bitcoin fell from $80,882 overnight to $75,573 in the afternoon, while ether lost more than 6%.

Regulation fears and the Binance breach

Investors are fretting that a Democratic-controlled Congress after last week's midterm elections will toughen regulation of digital assets. Democrats won control of both the House and Senate on 3 November, and the industry-backed Clarity Act, a market-structure bill, stalled in the Senate in September and now faces a harder path.

Confidence was also shaken by a $6 billion heist at Binance, the world's biggest crypto exchange, in recent sessions. Solana fell about 2.4% to near $87.30 and XRP dropped about 5.5% to near $1.10 as the sell-off spread across the market.

Traders now watch Tuesday's US October consumer price index, due at 8:30am Eastern time, for the next steer on interest rates and risk appetite. For ether, the next marker is the July low in the ETH/BTC ratio near 0.0283, with support for bitcoin near $73,692 and then the psychologically important $70,000 level.