Wall Street Pulls Money From Ethereum as Short Bets Mount

Wall Street Pulls Back From EthereumETH+1.29% ETFs

Wall Street seems to be taking a step back from Ethereum for the moment.

On October 9, institutional investors pulled $56.1 million from U.S. spot Ethereum ETFs. These specialized funds let people gain direct exposure to ETH through their everyday brokerage accounts.

The entire withdrawal for that day came out of BlackRock's ETF. This marked the ninth consecutive trading day of net capital exits from these funds.

Since September 29, these products have shed roughly $697 million. That steady drain has wiped out most of the $850.8 million that flowed into the funds during the seven trading sessions right before the streak began.

Ethereum Outflow Streak Matches Earlier Summer Run

This current nine-day streak matches a similar period from earlier in the year. Between June 17 and June 30, Ethereum ETFs also experienced a nine-day run of consecutive outflows.

Total assets across all U.S. spot Ethereum funds now stand at $15.71 billion, according to data from SoSoValue. That represents a noticeable drop from nearly $17.9 billion recorded in late September.

Despite the fund exits, Ethereum's spot price held relatively steady around $2,496 over a 24-hour window. However, that is still down from the $2,715.50 level ETH reached on October 2.

Past performance of digital assets is no guarantee of future results. You can check current prices and market trends on Bitkub Market.

BitcoinBTC+0.68% ETFs Rebound While Traders Shift Away From ETH

While Ethereum products faced steady exits, U.S. spot Bitcoin ETFs saw a slight rebound on October 9, drawing in $21.13 million in net inflows.

Data reported by Wu Blockchain shows that BlackRock's Bitcoin fund (IBIT) led those gains with $22.38 million in fresh inflows. That modest recovery came right after a massive $729 million exit from Bitcoin funds over October 7 and 8.

The cooling interest in Ethereum was also visible on crypto exchanges. On Binance, users reduced their Ethereum balances by 183,602 ETH during September while adding to their Bitcoin positions.

$5 Billion in Ethereum Short Bets Hover Overhead

As institutional cash leaves spot funds, derivatives traders are increasing their bets that Ethereum's price will fall.

Short positions—often referred to as 'shorts'—are trades designed to profit if prices drop. Traders often use borrowed capital to make these bets.

Currently, roughly $5 billion in short bets sit above the current ETH price, compared to $1.53 billion in long bets expecting a price rise.

Crypto analyst Ted Pillows commented on the current market imbalance:

"Most of the ETH downside liquidity has been taken out for now. Now there are $5 Billion in shorts vs. $1.53 Billion in longs. The only concern is weakening spot demand for Ethereum, which is still making a strong case for more correction."

Earlier in the week, Pillows identified $2,547 to $2,565 as critical support. He noted that if spot demand remains soft and support breaks, ETH could slide toward $2,190. Conversely, if sudden spot buying steps in or shorts are forced to close, prices could rebound.

ETH has since slipped below that support zone. When short sellers are forced to exit losing positions, they must buy back ETH, which can sometimes trigger a rapid upward price jump known as a 'short squeeze.'

For now, spot ETF buyers remain absent while short positions stack up above. Market participants will be watching Monday's flow data to see if the withdrawal streak extends to ten days.