Although Ether Holdings holds $2K, the ETH ETF will raise more than $242M
Ether holds $2,000, but traders may remain under pressure as they look at corporate earnings, US government debt and rising global tensions.
Main Receptors:
Institutional demand for Ether is slowing as investors move to the safety of short-term US government bonds.
High interest rates and increased supply of ETH make the current stock yield less attractive to long-term holders.
The price of Ether (ETH) has not been able to maintain levels above $2,150 since February 5, which made traders fear a further correction. Investor sentiment has soured following the exit from Ether exchange-traded funds (ETFs) and an increase in put (sell) options.
US-listed Ether ETFs saw net inflows of $242 million between Wednesday and Thursday, reversing the trend of the previous two days. Institutional interest, which followed a 20% recovery in Ether price from a low of $1,744 on February 6, has faded as investors point to inconsistent US economic growth – a growing demand for short-term US government bonds.
The 2-year Treasury yield fell to 3.42% on Friday, its lowest level since August 2022. Strong demand for government-backed debt reflects traders' hopes for further interest rate cuts by the US Federal Reserve (Fed) in 2026. Signs of an economic slowdown will lower inflation, reverse course.
Regardless of macroeconomic trends, Ether has underperformed the broader crypto market, leading traders to question what Ethereum still needs to compete with networks that offer base layer expansion and rapid onchain activity.
Traders fear that the price of ETH is in for more volatility, but the data appears to reflect recent price weakness rather than an expectation of a further crash.
Ether's price has dropped 38% in 30 days, which will put a negative pressure on the network's fees and ultimately reduce share incentives. Long-term holdings are a critical component of sustainable rate growth, and the current 2.9% yield on stocks is not attractive, considering the US Fed's target rate is at 3.5%. In addition, the supply of ETH is growing at an annual rate of 0.8%.
ETH derivatives reflect traders' fears of further price declines
Professional traders are not comfortable holding low price exposure according to the parameters of ETH derivatives, which further reinforces the sentiment.
The delta skew of ETH options stood at 10% on Friday, meaning they were selling oversold (put) options at a premium. The increase in demand from neutral-to-depressive strategies makes the indicator move above the 6% limit, which is typical for the past two weeks. Trader sentiment reflects a six-month bear market as ETH trades 58% below its all-time high.
Related: Crypto Investor Sentiment Rises After Clarity Act Release – Bessent
From a broader perspective, just $242 million in Ether ETFs represents less than 2 percent of the total $12.7 billion in assets under management. Therefore, traders should not assume that the price of ETH has entered a death spiral. Investor morale will finally recover as the network remains the absolute leader in Total Value Locked (TVL).
Traders' attention will focus on corporate earnings results and whether the US government will be able to repay its debt amid growing global socio-economic tensions. In this case, the price of ETH remains fixed regardless of the parameters of onchain and derivatives.
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