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<\/p>\nEthereum has spent much of December under pressure, and the recent fall below $3,000 has left a visible mark on investor positioning.\u00a0<\/p>\n
On-chain data now shows a notable deterioration in profitability across the network, with the share of ETH supply sitting in profit falling below 60%. At the same time, institutional demand has decreased, with data from Glassnode showing how both retail profitability and institutional participation in Ethereum have weakened simultaneously.<\/p>\n
The drop in Ethereum\u2019s percent supply in profit has been one of the clearest signals of stress for Ethereum. Ethereum’s investors have fallen into deeper losses, and this is a reflection of recent price action.\u00a0<\/p>\n
Speaking of price action, Ethereum had initially reclaimed the $3,000 price level on December 22. During this time, the percentage of ETH supply in profit pushed back above 60% and reached as high as 63%. However, this break was for only a very brief time, and price action fell back below $3,000 after just a few hours.\u00a0<\/p>\n
As ETH broke below $3,000 again, the share of supply held at unrealized gains fell under 60%, down from above 70% earlier in December. This fall shows that the pullback has not been limited to recent buyers but has begun to impact investors who accumulated during the beginning of the month.<\/p>\n
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ETH Percent Supply In Profit. Source: Glassnode<\/i><\/a><\/p>\n The weakness in on-chain profitability and price action is also a reflection of trends in the ETF market. Another data metric from Glassnode shows that since <\/a>early November, the 30-day moving average of net flows into US Spot Ethereum ETFs has turned negative and remained there. This persistence of outflows points to a phase of muted participation and disengagement from institutional traders.<\/p>\n The ETF chart below shows that inflows, which supported Ethereum\u2019s push to new all-time highs in August, have faded, replaced by continued outflows<\/a> through November and December. This matters for price action because ETF demand has been a key source of incremental buying. As that bid has weakened, Ethereum has struggled to absorb sell-side pressure, contributing to its failure to hold above $3,000.<\/p>\n ETH: US Spot ETF Net Flows. Source: Glassnode<\/i><\/a><\/p>\n The combination of negative ETF net flows and Ethereum\u2019s recent price behaviorhelps explain rising unrealized losses. Interestingly, various on-chain data sources<\/a> also reveal different instances of whale addresses reducing their exposure to Ethereum outside of spot ETFs.\u00a0<\/p>\n For instance, Lookonchain recently highlighted activity from a wallet<\/a> believed to be linked to Erik Voorhees, which swapped 4,619 ETH, valued at about $13.42 million, into Bitcoin Cash (BCH) over the past two weeks after having been inactive for nearly nine years. Voorhees later responded by clarifying<\/a> that the wallet does not belong to him and that he does not hold any Bitcoin Cash.<\/p>\nETF Net Outflows Indicate Waning Institutional Participation<\/b><\/h2>\n
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