Amid heightened volatility and macroeconomic drama, Ethereum [ETH] managed to attract over $11 million in inflows into its U.S. spot ETFs, outperforming Bitcoin’s ETFs during one of the most turbulent trading days of the week. This signals a subtle but important shift in institutional sentiment, even as retail traders hedge heavily against further price drops.

Ethereum ETFs Outperform Bitcoin Amid Volatility

On June 5, Ethereum ETFs saw $11.26 million in net inflows, according to data from Soso Value. In sharp contrast, Bitcoin ETFs recorded daily outflows of $278.44 million. The divergence points to growing confidence among institutional investors in Ethereum’s mid- to long-term prospects, especially as the market adjusts to geopolitical uncertainty and recent media-fueled drama involving Elon Musk and Donald Trump.

Notably, ETH ETFs have now recorded 16 consecutive days of net inflows. This consistency suggests that big players are not merely dipping their toes into the water—they’re gradually building positions in anticipation of a future breakout.

ETH Price Still Faces Short-Term Pressure

Despite the ETF inflows, ETH’s price dropped by 7% on Thursday, falling from $2,600 to a low of $2,390. It slightly rebounded to $2,400 by press time. The sharp decline triggered significant profit-taking, with on-chain metrics showing over $454 million in realized profits for the day.

The futures market also saw bulls suffer. Over the past 24 hours, long positions faced $256 million in liquidations, while shorts lost just $30 million, revealing an imbalance that underlines bearish dominance—at least in the short term.

Sellers Exhausting, But Traders Stay Cautious

One encouraging sign for ETH is that the Seller Exhaustion Constant, a key on-chain indicator from Glassnode, has returned to levels last seen in April. This metric evaluates the intensity of profit-taking and price volatility. Historically, low readings have marked reliable local bottoms, as seen during the April and October 2024 corrections.

In addition, analysts like Income Sharks believe ETH is still technically on an uptrend. After defending its $2,300 support zone, ETH may still aim for the psychological $3,000 level—provided current support levels hold and macro sentiment stabilizes.

Institutional confidence could play a key role here. If ETF inflows continue and treasury purchases rise, this could help Ethereum maintain its foothold and climb higher.

Options Market Suggests Traders Are Hedging Risks

While institutions are leaning bullish, options traders remain wary. Data from Velo shows that the 25 Delta Skew—a metric that reflects the demand for puts versus calls—spiked sharply across multiple tenors. This includes the 1-week, 1-month, and 3-month contracts.

In simple terms, traders have been more eager to purchase put options (bearish hedges) than call options (bullish bets), indicating a risk-off mindset. These bearish skew increases were especially pronounced following Thursday’s price drop and the broader market reaction to external political developments.

Although the 1-week Delta Skew later softened from 5% to 3%, suggesting some easing of fear, it remains elevated. This shows that while a relief bounce has occurred, confidence in a near-term breakout remains fragile.

What Comes Next for Ethereum?

Ethereum is currently trading in a zone of uncertainty. On one hand, long-term metrics—like steady ETF inflows, institutional purchases, and on-chain seller exhaustion—suggest that the foundation is being laid for a potential rebound. On the other hand, short-term caution persists among derivatives traders, reflecting unresolved fears around macroeconomic factors and recent political narratives.

If ETH can hold above $2,300 and reclaim $2,600 in the coming days, it could reignite momentum toward $3,000. But if bearish pressure intensifies, Ethereum may struggle to escape the current consolidation range.

Either way, ETH’s resilience amid ETF inflow and risk-off market conditions reveals growing maturity—and perhaps the early stages of a shift from speculative asset to institutional mainstay.