Ethereum spot ETFs recorded substantial outflows totaling $75.21 million on December 5, with all nine available funds reporting zero inflows for the day. This marks a concerning trend for the burgeoning ETF market, indicating a weakening investor sentiment towards Ethereum.
Key Takeaways
- •Ethereum ETFs experienced a net outflow of $75.21 million on December 5, extending a streak of negative redemptions to four consecutive days.
- •BlackRock's ETH ETF was the primary driver of these withdrawals, highlighting its significant impact on the market.
- •Despite the negative sentiment reflected in ETF outflows, the supply of ETH on exchanges has reached a record low.
BlackRock Drives Fourth Straight Day of Outflows
BlackRock's ETH ETF was singularly responsible for the day's entire withdrawal, contributing to the fourth consecutive day of net redemptions for Ethereum (ETH) ETFs. This sustained outflow suggests a growing cautiousness among investors regarding the cryptocurrency's short-term prospects.
Ethereum traded at approximately $3,030, with its 24-hour trading range observed between $2,995.50 and $3,146.10. The token has experienced a notable decline, dropping 2.7% over the past 24 hours and a more significant 10.3% over the preceding 30 days.
Ethereum ETFs have been bleeding capital since December 2, with recorded outflows of $79.06 million, $9.91 million, and $41.57 million prior to Thursday's $75.21 million withdrawal. The only period of positive net inflows occurred on December 3, which saw $140.16 million, largely driven by Fidelity's FETH ETF.
Despite the recent outflows, BlackRock's ETH ETF remains the largest Ethereum ETF by cumulative net inflows, holding $13.09 billion. In contrast, Grayscale's ETHE has seen -$4.99 billion in net outflows since its conversion from a trust structure. Fidelity's FETH has managed to accumulate $2.62 billion in total inflows.
As of December 5, the total net assets under management for all Ethereum ETFs collectively stood at $18.94 billion. The cumulative total net inflow across all these funds reached $12.88 billion.
The total value traded for Ethereum ETFs hit $1.77 billion on December 5, a slight increase from the $1.75 billion recorded the previous day.
In a contrasting performance, Bitcoin ETFs experienced positive momentum on December 5, with inflows amounting to $54.79 million. The total net assets for Bitcoin funds reached $117.11 billion, with cumulative inflows standing at $57.62 billion.
Exchange Supply Hits Record Low Amid Weak Sentiment
Concurrently with the ETF outflows, Ethereum's exchange balances have fallen to 8.84% of its total supply, marking the lowest level ever recorded. This metric, when compared to Bitcoin's 14.8% exchange balance, suggests a significantly tighter supply environment for ETH.
As noted by Milk Road on X, "ETH keeps getting pulled into places that don’t sell: staking, restaking, L2 activity, DA layers, collateral loops, long term custody." The analysis emphasizes that supply dynamics are not dictated by short-term market sentiment, even when the overall mood appears negative.
The post further elaborated, "ETH supply is tightening in the background while the market decides its next move. When that gap closes, price follows." This suggests that underlying supply constraints could lead to significant price appreciation once market sentiment shifts.