Ethereum Remains Volatile Ahead of US Inflation Report as ETH ETFs Shed Assets

Ethereum was up 0.5% in the past day even as exchange-traded funds tracking ETH continued to shed assets amid investor nervousness about inflation and other macroeconomic uncertainties.

The second largest crypto by market value was recently changing hands for $3,973. ETH is now 2.3% higher than it was this time last week but trading 9.5% below its price as of a month ago, according to crypto markets aggregator CoinGecko.

Ethereum ETFs shed $145 million on Monday, after losing $311 million last week. However, Bitcoin funds have been faster to rebound from last week, when outflows totaled $1.2 billion, according to U.K. investment firm Farside Investors. BTC funds lost $40.4 million yesterday.

“Presistent redemptions in recent sessions indicate that passive institutional selling remains active, while shrinking leverage and forced liquidations have increased near-term fragility,” Bitunix analyst Dean Chen told Decrypt. “The delayed U.S. CPI release, now set for October 24 due to the government shutdown, has become the key systemic risk trigger of the week.”

Users on Myriad, a prediction market owned by Decrypt parent company Dastan, correctly predicted that the U.S. government shutdown would drag on past mid-October. There was some doubt among users initially that the current shutdown, which has now extended to 20 days, could become the longest in history. To do that, it would need to last 35 days to beat the 2018-2019 shutdown during President Donald Trump’s first term.

But the odds flipped Monday and 60% of Myriad users now think the government will remain closed long enough to become the longest on record.

Meanwhile, institutions have felt more comfortable in BTC than ETH, Nic Puckrin, crypto analyst and co-founder of The Coin Bureau, told Decrypt.

“ETF flows suggest that Bitcoin remains the most trusted crypto asset for institutions, and its dominance remains close to 60%,” he said. “So it’s no surprise that Ethereum ETFs are suffering more.”

He added that although the crypto investors are showing signs of fatigue, “any positive news could reverse that quite sharply.”

Investors are now looking anxiously at  the Bureau of Labor Statistics September Consumer Price Index report set to be released on Friday. It would have been released last week if not for the shutdown, the BLS said.

“From a macro perspective, a stronger-than-expected CPI print could lift the U.S. dollar and real yields, putting renewed pressure on risk assets and potentially sending ETH toward the $3,700 zone,” Chen said. “Conversely, a softer inflation reading could trigger short covering and risk-on flows, helping normalize futures basis and drive a rapid rebound.”

The sentiment is echoed by Ethereum derivatives data, Jean-David Péquignot, chief commercial officer at Deribit by Coinbase, told Decrypt.

“Overall, ETH options point to elevated volatility expectations around CPI, with a defensive tilt short-term but more optimistic undertones,” he said. “A soft CPI could trigger bullish reactions by cooling yields and the dollar, supporting ETH retests of resistance. Stronger inflation data might extend consolidation or trigger downside.”