BlackRock ETF Sees $110M Ethereum Outflow Amid Broader Crypto Fund Redemptions

On September 16, BlackRock’s iShares Ethereum Trust (ETHA) faced a substantial outflow of $110.03 million, marking the largest single-day redemption in the US spot Ethereum ETF market. This withdrawal was part of a broader trend, with total net outflows across US spot Ethereum ETFs reaching $224 million as institutional investors reacted to the Federal Reserve's first interest rate hike in three years.

Interestingly, despite the significant outflows, Ethereum's spot price increased by 1.54% on the same day, indicating underlying demand from other market participants. BlackRock was not alone in experiencing redemptions; Fidelity's FETH product lost $55.58 million, and BlackRock’s staking-enabled Ethereum product, ETHB, saw $19.76 million in outflows.

The selling pressure extended beyond Ethereum, with US spot Bitcoin ETFs facing nearly $296 million in net outflows, driven primarily by BlackRock’s Bitcoin fund, IBIT, which accounted for $144.1 million of that total. However, 21Shares’ TETH managed to attract minor inflows, providing a slight counterbalance to the overall negative sentiment.

Despite the outflows, cumulative net inflows for US spot Ethereum ETFs remain robust at approximately $13.14 billion since their launch in mid-2024. This figure suggests that for every dollar withdrawn on September 16, around $59 had previously been invested and remained in these products.

The significant outflows are interpreted as a macro-driven de-risking event rather than specific concerns about the assets themselves. The established base of institutional holders, having entered at various price points over the past two years, creates a structural floor of demand that could support the market moving forward.