Spot Ether ETFs Experience $1 Billion Outflows Amid Economic Uncertainty
Spot Ether (ETH) exchange-traded funds (ETFs) have faced significant investor withdrawals, totaling over $1.04 billion in net outflows across six consecutive trading days. This trend reflects growing caution among investors as macroeconomic uncertainties deepen and enthusiasm for Federal Reserve rate cuts as a market catalyst diminishes.
Monday’s Outflows Highlight Shifts in Investor Sentiment
On Monday, Ether ETFs saw net outflows of $96.7 million. BlackRock’s ETHA fund was the primary contributor, with withdrawals amounting to $192.7 million. However, this was partially offset by inflows into Fidelity’s FETH ETF ($75 million), Grayscale’s ETHE ($9.5 million), and its mini fund ($11 million).
Total trading volume for Ether ETFs on Monday reached $1.52 billion, while overall net assets declined to $27.39 billion. This asset base now represents approximately 5.28% of Ether’s market capitalization, based on data from SoSoValue.
Outflow Trends and Market Technicals
Over the six-day period, the largest daily withdrawal was $446.7 million on Friday, with the smallest net outflow of $38.2 million occurring on Wednesday. Ether’s price has been trading near critical support levels between $4,250 and $4,300, facing resistance around $4,500. Bitcoin shows comparable dynamics, with strong liquidation interest near $108,800 and resistance close to $114,200.
Fading Optimism on Federal Reserve Rate Cuts
Investor pullbacks correspond with evolving views on the Federal Reserve’s monetary policy trajectory. While the CME FedWatch Tool indicates a 100% probability of a 25 basis point rate cut in September, market strategists caution that such cuts may not deliver the anticipated economic stimulus.
David Kelly, chief global strategist at JPMorgan Asset Management, highlighted potential downsides, noting that lower rates could reduce retirement incomes and dampen business sentiment, thereby weakening the broader economic environment.
Market signals further underscore this cautious stance: Treasury yields remain subdued, the U.S. dollar trades sideways, and gold prices are rising, all indicative of defensive positioning, according to analysis from Bitunix.
Spot Bitcoin ETFs Reverse Outflows
In contrast to Ether ETFs, spot Bitcoin (BTC) ETFs recorded positive inflows on Monday, attracting $368.25 million and ending a two-day outflow streak that saw over $387 million withdrawn. Bitcoin ETFs posted a trading volume of $3.02 billion for the day, with total net assets increasing to $145.41 billion. This inflow helped lift cumulative net inflows to $54.86 billion, partially offsetting earlier losses.
FinOracleAI — Market View
The persistent outflows from spot Ether ETFs reflect heightened investor caution amid uncertain macroeconomic conditions and skepticism about the stimulative effects of upcoming Federal Reserve rate cuts. These dynamics could weigh on Ether prices in the near term, especially if economic headwinds persist or intensify.
Conversely, the inflows into spot Bitcoin ETFs suggest a relative preference for Bitcoin as a defensive crypto asset amid market turbulence. Investors should monitor Federal Reserve communications and macroeconomic data releases closely, as shifts in monetary policy expectations will likely drive further fund flows and price volatility.
Impact: negative
