Ethereum has been experiencing upward momentum for months, driven, among other factors, by constant purchases from ETFs on the US stock market. This news portal had reported that, on several occasions, ether ETFs even surpassed bitcoin (BTC) ETFs in capital raising for several consecutive days.

But in the trading week ending Friday, September 26, the situation took a dramatic turn: ETH ETFs had their worst week since their launch. Net capital outflows from these financial instruments totaled $795.56 million.

The following chart, provided by the SosoValue platform, shows how capital has flowed into and out of Ether ETFs, week by week, since their launch in July 2024.

Capital flows into and out of ETH ETFs, week by week. Source: SosoValue.

Spot ETFs are backed by the underlying asset, in this case, the Ethereum cryptocurrency. Therefore, ETF purchases and sales directly impact the price of ETH. This is because the companies managing these investment funds must buy or sell ETH to back them or to redeem investors.

As a result, the price of ETH had a red week, as can be seen in the following CoinGecko chart:

  ETH price over the past 7 days. Source: CoinGecko.

It's worth clarifying that the price of ETH doesn't depend solely on ETFs, but the behavior of traders on cryptocurrency exchanges also contributed to its decline.

Jainam Mehta, an analyst at Traders Union, comments that "Ethereum's decline comes amid global macroeconomic uncertainty." This expert explains:

Persistent doubts about US monetary policy, combined with growing risk aversion in equities and cryptocurrencies, have significantly weighed on digital assets. This move is also consistent with a broad correction in major altcoins, underscoring that the pressure is spreading across the entire market and not limited to Ethereum.

Jainam Mehta, market analyst

Does all this mean the end of the love affair between Wall Street and Ethereum, which was driving the price of ETH higher? It's too early to give a concrete answer. But it should be noted that ETH's decline (like that of Bitcoin and other cryptocurrencies) is also due to a seasonal factor. September is typically a bearish month for digital assets.

This morning, showed that the historically most bullish month for bitcoin is about to begin: October.

And what about ETH? The following image, provided by the CryptoRank platform, shows that while October hasn't historically been the best month for ETH, it has been a mostly positive month. Since 2015, there have been 7 Octobers with positive returns for ETH and 3 negative ones:

Monthly returns of Ethereum's ETH cryptocurrency since 2015. Source: CryptoRank.

With this in mind, ETH is likely to replicate this seasonal behavior again, with October being a bullish month.

The aforementioned Mehta explains that in addition to seasonal factors, ETH has technical grounds for price growth. This analyst comments: "Despite the short-term weakness, the long-term narrative for Ethereum remains constructive. Scaling upgrades continue to improve network efficiency, while institutional interest through ETF-related developments highlights the persistent demand. These factors suggest that while the immediate trend is under pressure, the structural drivers of growth remain."

The price action of ETH, the capital flows from its ETFs, and the movements of corporate treasuries accumulating this cryptocurrency will likely reveal in the coming weeks whether the institutional love affair with Ethereum is over or still fully underway.