Ether ETF outflows top $200M amid rising unstaking pressure

Spot Ether exchange-traded funds (ETFs) saw nearly $200 million in investor withdrawals on Monday, extending a trend that began last week and adding fresh pressure to Ethereum’s market outlook. According to data from SoSoValue, Ether ETF outflows totaled $196.7 million, marking the second-largest single-day loss since the funds launched earlier this year. Only August 4, when $465 million was withdrawn, recorded a larger outflow.

The latest figures followed Friday’s $59 million in withdrawals, pushing the two-day total to $256 million. Ether ETF outflows come despite an earlier streak of record inflows, when investors poured more than $3.7 billion into the funds across eight consecutive trading days.

“After such a strong inflow run, some profit-taking is natural,” said James Butterfill, Head of Research at CoinShares, in a note to clients. “But the scale of recent Ether ETF outflows signals shifting sentiment among institutional investors.”

BlackRock and Fidelity lead withdrawals

BlackRock and Fidelity were the hardest hit by Monday’s Ether ETF outflows. According to Farside Investors, BlackRock’s iShares Ethereum Trust (ETHA) saw $87 million in redemptions, while Fidelity’s Ethereum Fund (FETH) lost $79 million.

On Friday, Fidelity’s FETH had already recorded $272 million in outflows, significantly contributing to the week’s losses. BlackRock, despite the pullback, remains one of the largest institutional holders of Ether, with 3.6 million ETH valued at $15.8 billion as of last Friday. That figure has since slipped to $15.6 billion, reflecting a 1.5% decline in asset value as ETH prices dropped around 6.5%, according to CoinGecko.

“Large-scale redemptions from marquee issuers like BlackRock and Fidelity suggest that the market is recalibrating its view of Ether’s near-term trajectory,” said Clara Medalie, Director of Research at Kaiko.

Unstaking queue signals deeper pressure

The timing of Ether ETF outflows coincides with growing stress in Ethereum’s proof-of-stake (PoS) network. ValidatorQueue data shows the unstaking queue representing Ether awaiting withdrawal from staking pools has surged to an all-time high of 910,000 ETH, worth roughly $3.9 billion.

Validators now face a wait of more than 15 days to unstake their holdings, underscoring the scale of the backlog. Analysts warn that such high levels of unstaking could signal a lack of confidence among validators and exert additional downward pressure on prices.

Samson Mow, a prominent Bitcoin advocate, argued that Ethereum’s challenges could erode its long-term competitiveness.

“The flippening will never happen, but the unstakening is coming,” Mow wrote on X last week, predicting that ETH’s ratio against BTC could fall to “0.03 or lower.”

At the time of writing, ETH traded at 0.036 BTC on TradingView, showing continued weakness against its main rival.

Can Ether ETFs maintain momentum?

Despite the recent Ether ETF outflows, analysts note that ETH-backed funds have shown surprising resilience when compared to Bitcoin ETFs. Data compiled by Dragonfly analyst Hildobby indicates that ETH ETFs now hold about 5% of total ETH supply, compared with 6.4% of Bitcoin supply locked in BTC ETFs.

“If the current growth trajectory continues, ETH ETFs could surpass BTC ETFs in terms of supply concentration by September,” Hildobby said on Monday.

This shifting balance underscores an important trend: even as Ether ETF outflows rise in the short term, investor appetite for ETH exposure remains strong relative to Bitcoin. That dynamic could shape the next phase of competition between the two largest digital assets.

What it means for investors

For crypto investors, the latest Ether ETF outflows highlight the fragility of market sentiment in a volatile environment. Heavy redemptions from institutional funds, coupled with mounting unstaking pressures, create headwinds for ETH in the near term. Yet the broader structural trend growing ETF adoption and relative strength versus Bitcoin offers a counterbalance for long-term holders.

“Ethereum is at a crossroads,” said Katie Talati, Head of Research at Arca. “The network’s fundamentals remain strong, but ETF flows will likely dictate price action over the coming months.”

With Ether ETF outflows nearing $200 million in just one day, investors will be watching closely to see whether this marks the start of a sustained reversal or merely a pause in institutional accumulation. Either way, the outcome will have lasting implications for both Ethereum’s market standing and the wider crypto ETF landscape.