Ether funding turns negative, but bears remain in control: Why?

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Ether's price struggled as investors pulled $225 million from the spot ETF, and Ethereum's share awards underperformed compared to stable coin yields.

Recent improvements to the Ethereum network and plans for improved wallet security are positive, but they have failed to jump-start demand for Ether.

The price of Ether (ETH) failed to maintain its level above 2,100 dollars last month, gradually losing traders' confidence in the altcoin. Despite the 7% rise between Monday and Tuesday, ETH derivatives indicators suggest a lack of interest in bullish positions, which could indicate that the bears are under control.

ETH Perpetual futures dipped into negative territory on Tuesday, indicating increased interest in short positions. More importantly, this measure has remained below the neutral 6% to 12% range for the past month. Part of this investor frustration stems from a 54 percent drop in prices in six months, although a slowdown in onchain activity has played a significant role.

Weekly base cap payouts on the Ethereum network averaged $2.3 million last month, down from a peak of $8 million in early February. While 7-day transaction counts have stabilized around 14 million, the current industry focus on layer-2 package scalability has yet to generate new demand for native Ether.

In contrast to the volatile futures markets, the ETH options risk gauge hovered near the neutral -6% to +6% range on Tuesday. Put (sell) options sold at a 7% premium to call (buy) instruments, suggesting confidence is slowly returning among Ether bulls. Additionally, no competitor has yet challenged Ethereum's $56 billion in total value locked (TVL).

Ether exchange-traded funds (ETFs) saw net inflows of $225 million between Thursday and Monday, reversing an inflow of $169 million seen on Wednesday. This measure is currently used as a proxy for institutional interest at the 2.8% native stock award rate. In comparison, the stablecoin on Sky Lending (formerly MakerDAO) is set at 3.75%.

Weak spot ETH ETF demand and concerns with the Ethereum roadmap

In the year The excitement surrounding ETF stock approvals in the US in late 2025 has yet to translate into sustained demand. It could be argued that the negative result was simply the result of bad luck, as the launch coincided with the broader crypto market crash that began after the total market capitalization peaked at $4 trillion in early October.

Related: Was Ethereum ‘Ultrasound Money' Wrong? Since the pivot, ETH is down 65% against BTC

ETH has underperformed the broader crypto market since October 2025, and there are no signs that a reversal has begun. Investor sentiment has been hurt by the shocking $735 million net loss from Ethereum treasury Sharplink (SBET US) in 2025. The company, led by Ethereum co-founder Joseph Lubin, released these financial results on Monday.

Native chain scaling speed contributed to Ether's negative performance. For example, Ethereum founder Vitalik Buterin said on Saturday that a balance sheet equivalent to modern accounts would be delivered “within a year” after more than a decade in the making. Transactions can reference each other's data, enabling quantum-resistant wallets.

Another special purpose of the upcoming Ethereum Hegota fork is to use decentralized exchanges to pay gas bills in non-ETH tokens, adding a “general purpose public member” and eliminating “public channels” in privacy platforms like Railgen and Tornado Cash. Buterin also said that he expects a “progressive reduction” in the long-term slot and deadline.

In general, ETH derivatives and onchain activity indicate low guilt with a massive breakout above $2,200, but at the same time, there is no sign of worse conditions or bearish dominance.