Ethereum price has endured significant selling pressure over the past week, reflecting the current state of the crypto market. The latest data shows that things weren’t even better for the US-based spot Ethereum exchange-traded fund, as large amounts of money have flowed out of the market over the past week.
Ethereum ETF weekly outflow exceeds $600 million
In a Quicktake post on the CryptoQuant platform, market commentator CryptoOnchain revealed the overwhelming outflow of institutional capital from the Ethereum market. More specifically, the analyst highlighted that over $600 million has been outflowed from the US-based Spot Ethereum ETF over the past week.
The relevant indicator here is the ETH ETF Net Flow indicator, which monitors the net movement of capital (in millions of USD) into and out of the Ethereum exchange traded fund market.
Related books
BlackRock’s iShares Ethereum Trust (ticker: ETHA) has been largely responsible for the massive outflow witnessed by Ethereum ETFs last week. A total of around $470 million was withdrawn from ETHA during the last trading week, according to CryptoQuant data.
Fidelity’s Ethereum fund (ticker: FETH) also recorded notable net outflows, with approximately $35 million withdrawn by investors. The Grayscale Ethereum ETF (ETHE) also recorded significant net outflows of approximately $49 million over the past week.
What the leak means for Ethereum price
Under normal circumstances, Ethereum ETFs tend to provide substantial price stability and institutional support for the ETH price. However, these products can also cause significant market volatility depending on investor behavior.
A wave of ETF outflows typically signals a decline in institutional investors’ risk appetite for Ethereum. CryptoOnchain explained that as the week begins with reduced exposure from institutional investors, prices also fall sharply, revealing less optimistic sentiment in the market. The lack of institutional demand could make it difficult for Ethereum to defend its immediate support levels.
Additionally, this could mean that institutional investors’ interest lies in price levels further south than the Ethereum price. This creates a demand vacuum below the current price level, which short-term traders may generally have a hard time filling.
The Ethereum market may be subject to further bearish pressure until ETF flows start increasing towards positive values. Therefore, it is very likely that the “King of Altcoins” will re-challenge lower support levels.
Therefore, it is important for investors to participate in the market with extreme caution. At the time of writing, Ethereum is valued at around $2,975, with no significant price movements over the past day.
Related books
Featured images from Shutterstock, charts from TradingView
Discover more from Earlybirds Invest
Subscribe to get the latest posts sent to your email.
