fter the ETH ETF Launch, the price has corrected over 40%. According to Bitfinex, this drop was caused by a classic sell the news event highlighted by the $420 million dollars outflow from the ETF.
Possible Reasons for Ethereum’s Relative Weakness
Although ETF outflows were an important factor to Ethereum’s price dip. But there were other market players affecting the price even more, such as Jump trading and Wintermute which were selling heavily. Moreover, Macroeconomics uncertainty and fear around a recession due to the Yen carry trade exacerbated the downside with ETH/BTC reaching a 1,200 day low.
Divergent ETF Performance
It is important to note that not all ETH ETFs have shown weakness. For instance, the blackrock shares ethereum trust (ETHA) has proved to be robust compared to others, recording $100 million dollars in inflow multiple times, with $977 million dollars in total cumulative inflows since launch.On the other hand, Grayscale saw significant outflow totaling approximately $2.4 Billion dollars.
Ethereum ETFs and Market Forces
The current market conditions indicate that there were multiple market forces that were pushing the price of crypto assets down. Some of the Ethereum ETFs are now recovering, but others are still in the red, which is characteristic of the cryptocurrency market. Over time, investors and analysts will pay attention to how these trends affect Ethereum's future and its correlation with other digital currencies.
