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U.S ETH Spot ETFs Lose $36M for 2nd Straight Day – What’s Fueling the Outflows?
The Ethereum (ETH) spot exchange-traded funds (ETFs) have recorded a staggering $36 million in daily outflows, marking the second consecutive day of bleed-out. The renewed risk-off sentiment has led to investors withdrawing from these products at an alarming rate.
In the past two days alone, ETH ETF investors have pulled out a whopping $100 million from the market. This starkly contrasts with the stable inflows witnessed in early February, which were fueled by irresistible high yields from the CME ETH basis trade.
The sharp decline in CME ETH yield, which has dropped to 6% from its peak of 8% towards the end of February, may be a key factor behind the outflows. This could dent appetite for carry trades and ETH ETFs. Furthermore, the CME Futures Open Interest (OI) rate has been steadily declining since January, indicating unwinding or closing positions by traders.
The weak market sentiment is not helping matters for the king altcoin, with its downside risk remaining a significant concern. Technical analysis suggests that ETH is approaching a crucial level of support around $2000. A breach below this point could alter the higher timeframe market structure and lead to further losses.
It remains unclear what will prompt investors to return to these products, but it’s imperative for Ethereum proponents to understand the factors driving these outflows.
Source: https://ambcrypto.com/u-s-eth-spot-etfs-lose-36m-for-2nd-straight-day-whats-fueling-the-outflows/
