Ethereum ETFs Bleed $145M as CPI Delay Rattles Markets

Ethereum presented a puzzling picture to market observers on Monday, with the cryptocurrency gaining 0.5% to trade at $3,973 even as exchange-traded funds tracking ETH continued to hemorrhage assets. According to data from crypto markets aggregator CoinGecko, ETH now stands 2.3% higher than it was this time last week but remains 9.5% below its price from a month ago. This modest daily gain occurred despite Ethereum ETFs shedding $145 million in a single day, extending last week’s $311 million outflow.

The divergence between price action and institutional flows highlights the complex dynamics currently affecting cryptocurrency markets. Bitunix analyst Dean Chen told Decrypt that “persistent redemptions in recent sessions indicate that passive institutional selling remains active, while shrinking leverage and forced liquidations have increased near-term fragility.” This sentiment reflects broader market concerns about inflation and macroeconomic uncertainties that have investors pulling capital from crypto investment vehicles despite relatively stable prices.

While Ethereum ETFs faced significant outflows, Bitcoin funds demonstrated stronger resilience in the current market environment. According to U.K. investment firm Farside Investors, Bitcoin ETFs lost only $40.4 million on Monday, representing a much faster recovery from last week’s $1.2 billion outflow. This performance gap underscores the differing levels of institutional confidence in the two leading cryptocurrencies.

Nic Puckrin, crypto analyst and co-founder of The Coin Bureau, explained this divergence to Decrypt: “ETF flows suggest that Bitcoin remains the most trusted crypto asset for institutions, and its dominance remains close to 60%. So it’s no surprise that Ethereum ETFs are suffering more.” This institutional preference for Bitcoin has become a defining feature of the current market cycle, with BTC maintaining its position as the preferred crypto asset for major financial institutions despite Ethereum’s technological innovations and broader ecosystem development.

The delayed U.S. Consumer Price Index report has become the focal point of market anxiety, with the Bureau of Labor Statistics September CPI now scheduled for release on October 24 due to the ongoing government shutdown. Originally slated for last week, the postponement has created significant uncertainty in crypto markets, with analysts identifying it as the week’s primary risk factor.

Dean Chen of Bitunix outlined the potential scenarios for Ethereum: “From a macro perspective, a stronger-than-expected CPI print could lift the U.S. dollar and real yields, putting renewed pressure on risk assets and potentially sending ETH toward the $3,700 zone. Conversely, a softer inflation reading could trigger short covering and risk-on flows, helping normalize futures basis and drive a rapid rebound.” This binary outcome has left markets in a state of suspended animation, with investors hesitant to make significant moves ahead of the critical data release.

The government shutdown, now extending to 20 days, has created broader market complications beyond just the delayed CPI data. Users on Myriad, a prediction market owned by Decrypt parent company Dastan, correctly predicted that the shutdown would drag on past mid-October. Market sentiment has shifted significantly, with 60% of Myriad users now believing the government will remain closed long enough to surpass the 35-day record set during President Donald Trump’s first term from 2018-2019.

Jean-David Péquignot, chief commercial officer at Deribit by Coinbase, told Decrypt that this uncertainty is reflected in Ethereum derivatives data: “Overall, ETH options point to elevated volatility expectations around CPI, with a defensive tilt short-term but more optimistic undertones. A soft CPI could trigger bullish reactions by cooling yields and the dollar, supporting ETH retests of resistance. Stronger inflation data might extend consolidation or trigger downside.” This volatility expectation has created a cautious trading environment, with market participants positioning for potential sharp moves in either direction.

Despite the current negative sentiment and institutional outflows, analysts see potential for rapid market reversals. Nic Puckrin of The Coin Bureau noted that although crypto investors are showing signs of fatigue, “any positive news could reverse that quite sharply.” This suggests that while the immediate outlook appears challenging for Ethereum, the market remains highly sensitive to catalysts that could trigger renewed buying interest.

The coming days will be critical for determining the near-term direction of both Bitcoin and Ethereum markets. The resolution of the government shutdown, the eventual release of CPI data, and institutional flow patterns will all contribute to market sentiment. With Bitcoin maintaining its dominance near 60% and Ethereum facing continued ETF outflows, the divergence between the two major cryptocurrencies appears likely to persist until clearer macroeconomic signals emerge to guide investor decisions.