Fidelity Investments made a significant $140 million purchase of Ethereum last week, according to data from blockchain intelligence firm Arkham. This move signals strong institutional demand for its Ethereum-based investment product, coming after a week of positive performance for Fidelity's ETF despite broader market headwinds.
However, this bullish bet was overshadowed by a larger opposing move from asset management giant BlackRock, which sold over $285 million worth of its Ethereum ETF holdings. The net effect was a substantial outflow from the Ethereum ETF market, with combined products seeing $206.4 million leave last week. Arkham's data visualization highlighted the disparity, showing total ETH ETF flows at approximately -$200 million for the period.
The outflows were part of a wider risk-off sentiment across digital asset investment products. A separate report from CoinShares revealed that crypto funds overall experienced $414 million in net outflows, marking the first weekly net negative in five weeks. Ethereum funds bore the brunt of this sell-off, shedding $222 million alone—the largest loss of any digital asset tracked. This has dragged Ethereum's year-to-date flows to a net outflow of $273 million, the worst performance among crypto products monitored by CoinShares.
Analysts point to two primary drivers for the institutional caution. Growing concerns around the upcoming U.S. crypto market structure bill, known as the Clarity Act, have rattled investors. CoinShares Head of Research James Butterfill noted the Ethereum funds drawdown was "likely related to the Clarity Act news," as a new draft of the legislation has drawn scrutiny for its potential implications for staked ETH products and yield-bearing stablecoin programs. The fallout extended beyond ETFs, with USDC issuer Circle seeing its shares drop roughly 25% in the past week on related speculation.
Shifting macroeconomic expectations have also played a key role. Fading hopes for near-term Federal Reserve interest rate cuts have contributed to the broader sell-off. Market sentiment has shifted dramatically, with traders now 97.4% certain the Federal Open Market Committee (FOMC) will hold rates steady at its next meeting, a reversal from more dovish expectations a month ago.
Despite the institutional outflow pressure, Ethereum's spot price showed resilience. The asset was trading around $2,041, having gained 2.3% in 24 hours as it recovered from a weekend slump. Notably, after six consecutive months of steady declines, Ethereum is on track to break its negative return streak, posting a gain of 5.64% for March, according to data from CryptoRank.
