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The Ethereum ETF decline stretched into a third consecutive session on September 3, with funds shedding $38.2 million in net outflows, according to data from SoSoValue. The downturn was led by BlackRock’s ETHA fund, which registered approximately $151 million in redemptions.
Not all issuers saw withdrawals. Fidelity’s FETH logged inflows of $65.8 million, Grayscale’s ETH gained $26.6 million, and Bitwise’s ETHW attracted $20.8 million. Even so, the cumulative balance was negative, reflecting weakening demand for Ethereum-linked products.
“The scale of redemptions shows that Ethereum is still struggling to capture consistent institutional flows compared to Bitcoin,” — James Butterfill, Head of Research at CoinShares, told Bloomberg.
The Ethereum ETF decline follows what had been a robust run of investor demand. Just last week, Ethereum funds recorded six straight sessions of inflows, totaling more than $1.8 billion. The reversal highlights volatility in sentiment, particularly as ETH’s price has faced pressure.
Across the past three days, Ethereum ETFs have shed a combined $338 million. By comparison, Bitcoin products have outperformed, pulling in more than $634 million in just two days.
“This divergence reflects how investors are positioning ahead of potential macro shifts, with Bitcoin seen as the safer institutional gateway,” — Clara Medici, Senior Analyst at Chainalysis, told Decrypt.
The Ethereum ETF decline coincided with Ethereum’s price movements. ETH rebounded slightly on September 3, trading at $4,414 after an earlier dip toward $4,200. Despite the bounce, the token remains down roughly 4% on the week and around 11% below its all-time high.
Analysts say the $4,500 threshold is the level to watch. A decisive break above could unlock bullish momentum toward $5,000, while failure to hold could push ETH back into the $4,000–$4,100 range.
“Ethereum is still showing resilience above key moving averages, but the $4,500 breakout zone is crucial,” — Markus Thielen, Head of Research at 10x Research, said in a note to clients.
Some forecasts suggest ETH could stretch toward $6,000 if broader market momentum sustains, though much depends on macroeconomic signals and continued institutional demand.
Beyond the near-term technicals, Ethereum’s performance is closely tied to broader risk sentiment in global markets. With equities showing signs of volatility and bond yields climbing, crypto could face headwinds if risk-off sentiment intensifies. A shift in Federal Reserve policy could be the catalyst that determines whether ETH breaks higher or drifts lower.
Another factor shaping Ethereum’s trajectory is network activity. Daily gas fees and active address counts have remained relatively stable, suggesting that user demand has not collapsed despite price fluctuations. For investors, this points to a foundation of organic activity that could support long-term value even if ETF-driven momentum wavers.
Lastly, competition from other Layer-1 networks remains a variable to watch. Solana and newer ecosystems are gaining traction in real-world asset tokenization, potentially diverting institutional flows that might otherwise target ETH. Whether Ethereum can maintain its dominance as the leading smart contract platform will directly impact its ability to sustain higher price levels.
Despite the recent Ethereum ETF decline, on-chain data suggest growing confidence among large holders. Whale wallets and institutional addresses have accumulated ETH over the past week, providing a buffer against further downside.
This accumulation could help stabilize price action, reinforcing Ethereum’s long-term outlook even as short-term ETF flows remain uneven. If sustained, analysts believe renewed inflows into Ethereum exchange-traded funds may follow.
For crypto investors, the key question is whether the Ethereum ETF decline represents a temporary pause in demand or a deeper signal of shifting preferences toward Bitcoin. With rate-cut speculation building and institutional flows in flux, the coming weeks will be pivotal in determining Ethereum’s ability to reassert itself as the second-largest player in regulated crypto markets.
Interestingly, fund allocation patterns show that some institutional desks are rotating into Ethereum at the expense of smaller altcoins, viewing ETH as a safer bet in a volatile environment. This relative positioning underscores Ethereum’s role as a “blue chip” in digital assets, even if it lags Bitcoin in ETF traction.
Whale activity has also been visible in staking. Large deposits into Ethereum’s staking contracts suggest that long-term holders remain committed to earning yield rather than exiting positions. For investors, this behavior reduces circulating supply on exchanges, which can amplify upward price pressure if demand returns.
Still, uncertainty lingers around whether ETF inflows can scale to match those seen in Bitcoin products. Ethereum’s lack of a capped supply and its more complex monetary policy may continue to make some institutions cautious. Until these hesitations are resolved, ETH could remain in a consolidation phase even as whales and long-term believers quietly accumulate.
