Ethereum Loses $10B in Open Interest: What’s Next for ETH Price?

Massive $10 Billion in Open Interest Erased

Within just ten days, over $10 billion in Ethereum Open Interest has vanished. This substantial drop signals a broad de-risking among traders and institutions. Despite the red candles, Ethereum saw back-to-back $1 billion+ in Realized Profits, indicating profit-taking, not panic selling.

First Weekly Red Candle Signals Reset

The previous week marked Ethereum’s first meaningful weekly decline in months, closing nearly 9.67% lower. However, ETH has already bounced back by almost 4% this week, indicating that bullish sentiment is far from dead.

Supporting this view, BlackRock reportedly acquired 23,000 ETH worth around $88 million, reinforcing the notion that institutional investors are buying the dip.

Whale Activity Declines, ETFs Pull Funds

Despite bullish signs, some metrics are flashing early warning signals. Notably, whale addresses have declined by 164 in the last 30 days, and per SoSoValue, ETH ETF outflows surged, with over $500 million exiting in a single day — a record.

Adding to concerns, Fidelity recently moved nearly 14,978 ETH (worth $53.6 million) to Coinbase Prime, potentially preparing to sell. This suggests institutional investors might be shifting to a risk-off approach, locking in gains before potential volatility.

Key Support at $3,500, Bulls Still Have a Shot

Although ETH has rebounded 4%, the bounce is under scrutiny. If whale selling continues and ETF redemptions escalate, Ethereum could face a liquidation cascade, especially with over $60 million in liquidity centered around the $3,500 mark.

While $3,900 appears to be acting as a local top for now, a surge in spot demand will be crucial for ETH to reclaim that level. The market is at a tipping point — Ethereum’s next move could shape the crypto landscape in the coming weeks.