Ethereum ETFs Signal Early Recovery as Price Eyes $2.4K

Key Insights

• Ethereum ETFs recorded $71M inflows after an outflow streak, and the ETH price traded below $2000.
• Futures basis held below neutral despite price pressure.
• Ethereum DEX volumes doubled within one month.

Ether price struggled below $2,000 on Thursday after failing to hold recent gains. The token had rebounded from a nine-month low of $1,745 last Friday, but momentum remained fragile. Traders now assessed whether renewed institutional flows and steadier derivatives data could support a move toward $2,400.

The Ethereum price narrative shifted as exchange-traded fund activity stabilized and on-chain metrics improved. While sentiment cooled after the sharp drawdown, early capital inflows suggested that institutional participants had not exited the market. That shift mattered because Ether price often reacted to liquidity conditions before retail demand returned.

Ethereum ETFs Liquidity Returned as Outflows Broke

Farside Investors data showed U.S.-listed Ether exchange-traded funds attracted $71 million in net inflows between Monday and Tuesday, ending a three-day run of withdrawals. Assets under management held steady at $13 billion, a level that sustained institutional participation.

Daily trading volume averaged above $1.65 billion, providing sufficient liquidity for large hedge funds.

US-listed Ethereum ETFs daily net flows, USD. Source: Farside Investors

That flow stability mattered because liquidity determines access for institutional desks. For comparison, State Street’s Energy Select Sector SPDR Fund traded roughly $1.5 billion per day.

The instrument tracked around $2 trillion in market capitalization across major U.S. energy firms. The parallel suggested Ether ETFs had reached operational scale rather than remaining niche vehicles.

Yet ETF inflows alone did not confirm a bullish shift. Traders continued to evaluate whether derivatives positioning aligned with renewed spot demand.

Futures Premium Stabilized Despite Price Pressure

Laevitas derivatives data showed the two-month annualized basis rate held near 3% on Wednesday, remaining below the 5% neutral threshold. The subdued premium indicated limited appetite for leveraged bullish positions. However, the indicator did not collapse further even as Ethereum price touched its lowest point in nine months.

That resilience reflected a derivatives market that absorbed downside without panic. Over the prior three months, the basis had repeatedly struggled to reclaim neutral territory. Still, stabilization during price weakness suggested short sellers did not gain full control of the curve.

At the same time, funding conditions avoided sharp negative prints, which often signal capitulation. The absence of extreme backwardation implied that traders expected consolidation rather than an extended decline. Market participants, therefore, focused on structural metrics beyond price charts.

On-Chain Activity Narrowed the Solana Gap

DefiLlama records showed Ethereum’s total value locked fell to $54.2 billion from $71.2 billion one month earlier. Lower deposits reduced smart contract usage and compressed fee generation. That dynamic pressured staking yields because Ethereum’s burn mechanism relies on network demand.

Ethereum Total Value Locked (TVL). Source: DefiLlama

Despite weaker locked capital, user activity showed improvement in early 2026. Weekly decentralized exchange volumes rose to $20 billion from $9.8 billion over the same period. Increased trading lifted decentralized application revenue to $26.6 million in the seven days ending Feb. 8.

Solana maintained leadership with $31.1 million in weekly decentralized application revenue. However, the revenue gap narrowed as Ethereum regained transaction flow. That convergence indicated users returned to core decentralized finance applications even as locked capital declined.

Improving throughput mattered because transaction demand feeds both fee revenue and token burn dynamics. Although the total value locked contracted, activity metrics suggested underlying network engagement did not deteriorate proportionally.

Builders continued deploying decentralized finance tools and liquidity pools across Ethereum’s base layer and rollup networks.

Ethereum ETFs Drive Divided Market Outlook as $2,400 Becomes Key Test

The mixed data set created a divided market view. Some investors focused on falling locked capital and muted futures premiums. Others pointed to ETF liquidity and recovering decentralized exchange volumes as early signs of stabilization.

Short-term positioning, therefore, hinged on whether capital inflows persisted. If ETF demand extended beyond the recent inflow window, traders could interpret that as renewed conviction rather than temporary allocation shifts.

The immediate technical focus is now centered on $2,400 as the next upside test. A sustained move above that level would likely require continued ETF demand and a basis rate reclaiming neutral territory. Failure to hold recent support zones, however, could reintroduce downside pressure despite improving activity metrics.

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