Crypto: Ether Holds $2k, But Will $242m Spot ETH Etf Outflow Reignite Price...

Ether holds $2,000, but may remain under pressure as traders watch corporate earnings, US government debt and growing global tensions.

Institutional demand for Ether is cooling as investors shift toward the safety of short-term US government bonds.

High interest rates and rising ETH supply make the current staking yield less attractive for long-term holders.

Ether (ETH) price has failed to sustain levels above $2,150 since Feb. 5, leading traders to fear a further correction. Investor sentiment deteriorated following outflows from Ether exchange-traded funds (ETFs) and increased demand for put (sell) options.

US-listed Ether ETFs saw $242 million in net outflows between Wednesday and Thursday, reversing the trend from the prior two days. The institutional demand that followed the 20% Ether price recovery after the $1,744 bottom on Feb. 6 has faded as investors noted inconsistency in US economic growth—evident by the growing demand for short-term US government bonds.

Yields on the US 2-year Treasury declined to 3.42% on Friday, nearing the lowest levels seen since August 2022. The higher demand for government-backed debt reflects traders’ expectations of further interest rate cuts by the US Federal Reserve (Fed) throughout 2026. Signs of economic stagnation reduce inflationary risks, paving the way for expansionist measures.

Regardless of macroeconomic trends, Ether has underperformed the broader cryptocurrency market, causing traders to question if Ethereum still has what it takes to compete against networks that offer base layer scalability and faster onchain activity.

Traders fear that ETH price is destined for more downside, but data seems to reflect the recent price weakness rather than the anticipation of a further crash.

Ether price declined 38% in 30 days, which negatively pressures the network’s fees and ultimately reduces incentives for staking. Long term holding is a critical component for sustainable price growth, and the current 2.9% staking yield is far from appealing, considering the US Fed target rate stands at 3.5%. Furthermore, the ETH supply is growing at an 0.8% annualized rate.

Professional traders are not comfortable holding downside price exposure according to ETH derivatives metrics, which further reinforces the bearish sentiment.

Source: CoinTelegraph