BlackRock Triggers Record Ethereum ETF Outflow

Key Takeaways

• $465 million was withdrawn from U.S. spot Ethereum ETFs on Monday, the largest daily outflow since launch.

• BlackRock’s ETHA experienced the biggest drawdown with $375 million in net outflows.

• Other major funds like Fidelity (FETH) and Grayscale also faced notable losses.

• ETH’s price dropped 12% over the weekend before rebounding on Tuesday.

• Despite ETF outflows, whale and institutional buying of ETH remains strong through OTC deals.

Ethereum ETF Outflows Hit Record Levels

According to data from Farside Investors, spot Ethereum ETFs saw net outflows of $465 million on Monday alone.

This was the second consecutive day of outflows, breaking a 20-day streak of uninterrupted gains. Just days earlier, these funds lost $152 million on Friday.

Spot ETH ETFs Data

Source: SoSoValue

Why Are Ethereum ETFs Bleeding Capital?

The heavy outflows suggest a shift in investor sentiment, possibly triggered by price volatility in the Ethereum market.

On Sunday, ETH dropped to $3,380, marking a 12% decline from Thursday’s high of $3,858. By Tuesday, however, Ethereum had somewhat rebounded, reaching $3,629, according to CoinGecko.

BlackRock’s iShares Ethereum Trust Takes The Hardest Hit

$375M Pulled from ETHA

The largest portion of Monday’s outflow came from BlackRock’s iShares Ethereum Trust (ETHA), which saw a massive $374.8 million in net redemptions.

Despite the drawdown, ETHA still maintains cumulative net inflows of $9.3 billion and net assets totaling $10.7 billion.

Fidelity & Grayscale Also Affected

The Fidelity Ethereum Fund (FETH) reported the second-largest daily outflow, losing $55.11 million. Its cumulative net inflows remain at $2.2 billion, with $2.4 billion in net assets.

Meanwhile, Grayscale’s Ethereum-focused ETFs also recorded notable outflows:

• Grayscale Ethereum Mini Trust (ETH): $28 million outflow

• Grayscale Ethereum Trust (ETHE): $6.9 million outflow

Grayscale Performance Metrics:

• ETHE: $4.3 billion in cumulative net outflows; $4.1 billion in net assets

• ETH: $1.1 billion in cumulative inflows; $2.3 billion in net assets

Despite Outflows, Institutional Interest In ETH Remains Strong

Interestingly, while retail investors appear to be offloading ETH-focused ETFs, on-chain data suggests institutions are buying.

Whale Activity Surges

According to Lookonchain, three wallets, believed to belong to whales or institutions, collectively acquired 63,837 ETH via over-the-counter (OTC) transactions with FalconX and Galaxy Digital.

Source: X (@lookonchain)

New Wallets Accumulating Billions

Since July 9th, 14 new wallets have collectively purchased 856,554 ETH, valued at over $3.1 billion. This indicates continued long-term confidence in Ethereum, despite ETF volatility.

FAQ

What is an Ethereum ETF?

An Ethereum ETF is a financial product that allows investors to gain exposure to Ethereum’s price movements without directly holding the cryptocurrency. These funds track Ethereum’s market price and are traded on traditional stock exchanges.

Why did Ethereum ETFs see such large outflows?

Recent price volatility, short-term profit-taking, or a shift in market sentiment could explain the large outflows. Some investors might also be reacting to macroeconomic uncertainty or reassessing their crypto allocations.

Is BlackRock’s Ethereum ETF still performing well?

Despite the significant outflow, BlackRock’s ETHA still maintains strong net inflows ($9.3 billion) and solid assets under management ($10.7 billion), indicating ongoing investor interest over the long term.

Are institutions still interested in Ethereum?

Yes. On-chain data shows that institutions and crypto whales are actively accumulating ETH, even as ETF outflows increase. This signals continued belief in Ethereum’s long-term value.