Ether Plunges 8% Amid Heavy Outflows from ETH ETFs

On Thursday, Ether (ETH) experienced a significant price drop, falling below the $3,200 mark as newly launched Ethereum exchange-traded funds (ETFs) reported substantial outflows. 

The cryptocurrency declined by over 8% in 24 hours, trading at approximately $3,100. This downturn also affected other major cryptocurrencies, including Bitcoin (BTC) and Solana (SOL), which showed red indexes within the same period.

ETH price decline and market impact

Ether’s price reduction follows the trend of a broader market slump, with the total cryptocurrency market capitalization decreasing by over 4%, now standing at $2.32 trillion. Bitcoin, another primary cryptocurrency, saw its price decrease by 4%, trading around $64,144 at the time of writing. Despite this price drop, Bitcoin’s 24-hour trading volume increased by 9%, reaching $34.6 billion.

Data reveals that the net outflow for spot ETH ETFs on July 24 amounted to $133 million, with a total trading volume of $1.05 billion. The Grayscale ETH Trust ETF (ETHE) experienced a significant outflow of $327 million. 

The Grayscale Mini ETF ETH had an inflow of approximately $46 million. The Fidelity Ether ETF (FETH) saw the highest daily inflow, with $74.4 million. Meanwhile, the Bitwise Ethereum ETF (ETHW) recorded an inflow of $29.64 million. As of the second day of trading, Ether spot ETFs’ total net asset value stood at $9.538 billion.

Challenges for ETH bulls and market liquidations

Source: Sosovalue

Introducing new investment products tied to Ethereum has notably impacted the market. Over the last 60 days, ETH’s price has dropped by 16%, currently averaging $3,172. The 24-hour trading volume for ETH remains marginally higher, at $22.2 billion. According to Coinglass data, approximately $102 million worth of long and short positions on ETH were liquidated in the past 24 hours, with $98.35 million (95%) being long positions. 

Source: Coinglass

This large proportion of liquidated long positions indicates that many traders were betting on a price recovery for ETH, but bearish sentiments prevailed. On-chain trackers report that total liquidations reached $290 million in the past 24 hours, with over $262 million (90%) being long bets, reflecting increased selling pressure across the cryptocurrency market.

Bitcoin and Its ETF Movements

Bitcoin also faced a downturn, losing 4% in value, and is currently trading at an average price of $64,144. Despite the price drop, Bitcoin’s trading volume rose 9%, reaching $34.6 billion in the last 24 hours. BTC-linked ETFs recorded a daily net inflow of $44.51 million. BlackRock’s IBIT ETF had an inflow of $65.99 million, while ARK’s ARKB ETF saw an inflow of $3.29 million. Conversely, Grayscale’s GBTC reported outflows of $26.22 million over the last day. Cumulatively, Bitcoin ETFs maintain a positive net flow of $17.5 billion.

The recent launch of ETH ETFs has brought about significant outflows, contributing to a notable decline in Ether’s price. The broader cryptocurrency market also experienced a downturn, with substantial liquidations highlighting bearish sentiments. Despite its price drop, Bitcoin saw increased trading volume and continued positive net flows in its ETFs.

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