Ethereum News Today: Investors Shift to Bitcoin as Ethereum ETFs Face Sharp Outflows

U.S. spot Ethereum exchange-traded funds have experienced a significant four-day outflow totaling $787.6 million as of early September, according to Farside Investors. Ether-related products have seen a sharp reversal from the $3.87 billion in inflows recorded in August, with Ethereum ETFs now facing a capital outflow that marks one of the largest since the product’s launch. BlackRock’s ETHA, which held over $16 billion in assets under management (AUM) as of early September, recorded $148.8 million in inflows on September 4 before reversing to $309.9 million in outflows on September 5. Meanwhile, Grayscale’s ETHE and Fidelity’s FETH both saw substantial outflows, with ETHE shedding $309.9 million on September 5 and FETH losing $216.7 million on September 4.

The outflows coincided with a broader shift in investor sentiment toward Bitcoin ETFs, which posted a net inflow of $250.3 million during the same period. BlackRock’s iShares Bitcoin Trust (IBIT) was the largest contributor, adding $434.3 million in assets. Bitcoin ETFs have benefited from growing macroeconomic uncertainty and weak labor data, with the U.S. nonfarm payrolls report adding only 22,000 jobs in August. This has led to speculation that the Federal Reserve may implement further rate cuts in 2025, prompting institutional investors to move capital toward Bitcoin as a perceived safer asset during times of market turbulence.

Analysts have attributed the outflows from Ethereum ETFs to a combination of profit-taking and macroeconomic anxiety. Farzam Ehsani, CEO of VALR, noted that the outflows should be viewed more as a natural repositioning than a loss of confidence in Ethereum. “After strong August inflows, many institutional desks have likely been taking profits,” he said. Ehsani also pointed out that Ethereum’s inability to stake holdings in ETFs makes it less attractive during risk-off periods compared to Bitcoin, which can be held in staking-friendly products.

Ethereum’s price has remained relatively flat, trading at $4,304 as of early September, according to CoinGecko. In contrast, Bitcoin rose to $111,811, up 0.5% on the day and 2.1% over the past week. The divergent performance highlights a broader shift in investor risk appetite, with Bitcoin increasingly viewed as the more stable option during periods of market volatility. This trend has also been reflected in open interest data, which shows a sharp 18% decline in Ethereum futures open interest to $58 billion from an all-time high of $70 billion in late August. Reduced open interest typically signals weaker bullish sentiment and lower market participation.

Despite the outflows, Ethereum’s fundamental metrics remain strong. Santiment data indicates that large whale holders have increased their Ethereum positions by 14% over the past five months, suggesting long-term confidence in the network. Additionally, Ethereum’s staking growth and DeFi activity remain robust, according to Konstantin Anissimov, CEO of Currency.com. He emphasized that the outflows represent a timing issue rather than a loss of conviction in the asset’s long-term potential.

The overall performance of crypto ETFs has remained mixed in 2025, with inflows outpacing last year’s figures but showing signs of cooling in early September. CoinShares reported a 27% decline in weekly trading volumes, suggesting that investor appetite for digital assets has waned slightly. However, the broader picture remains positive, with Bitcoin ETFs continuing to attract institutional capital and Ethereum ETFs poised for potential rebounds if the price stabilizes or trends upward. The coming weeks will likely provide key insights into whether the current outflows represent a temporary correction or the beginning of a more sustained shift in investor preferences.

Source: [1] Ethereum ETFs Shed $788M Over Four Days in Institutional ... (https://finance.yahoo.com/news/ethereum-etfs-shed-788m-over-113308429.html) [2] Why is Ethereum price failing to break $4.5K? (https://cointelegraph.com/news/why-is-ethereum-price-failing-to-break-4-5k) [3] Crypto ETFs Log Outflows as Ether Funds Shed $912M (https://cointelegraph.com/news/crypto-etfs-outflows-ether-funds-shed-912m-report) [4] Ether ETFs Post 4-Day Outflows After Strong August (https://cointelegraph.com/news/ether-etf-outflow-week-traders-high-hopes-rebound) [5] Bitcoin (BTC-USD) ETF Inflows Hit $250M as Price Holds $110K (https://www.tradingnews.com/news/bitcoin-btc-usd-etf-inflows-top-250m-usd) [6] Ether Enthusiasm Cools as ETFs Shed $505M in 4-Day Slide (https://www.coindesk.com/markets/2025/09/05/ether-enthusiasm-cools-as-etfs-shed-usd505m-in-4-day-slide-flipping-bitcoin-funds)