Ethereum has spent much of December under pressure, and the rhas left a visible mark on investor positioning. 

On-chain data now shows a notable deterioration in profitability across the network, with the share of ETH supply sitting in profit falling below 60%. At the same time,, with data from Glassnode showing how both retail profitability and institutional participation in Ethereum have weakened simultaneously.

Ethereum’s Percent Supply In Profit Falls Below 60%

The drop in Ethereum’s percent supply in profit has been one of the clearest Ethereum’s investors have fallen into deeper losses, and this is a reflection of recent price action. 

Speaking of price action, Ethereum had initially reclaimed the $3,000 price level on December 22. During this time, the percentage of ETH supply in profit pushed back above 60% and reached as high as 63%. However, this break was for only a very brief time, and price action fell back below $3,000 after just a few hours. 

As ETH broke below $3,000 again, the share of supply held at unrealized gains fell under 60%, down from above 70% earlier in December. This fall shows that the pullback has not been limited to recent buyers but has begun to impact investors who accumulated during the beginning of the month.

ETF Net Outflows Indicate Waning Institutional Participation

The weakness in on-chain profitability and price action is also a reflection of trends in the ETF market. Another data metric from Glassnode early November, the 30-day moving average of net flows into US Spot Ethereum ETFs has turned negative and remained there. This persistence of outflows points to a phase of muted participation and disengagement from institutional traders.

The ETF chart below shows that inflows, which supported Ethereum’s push to new all-time highs in August, have faded, through November and December. This matters for price action because ETF demand has been a key source of incremental buying. As that bid has weakened, Ethereum has struggled to absorb sell-side pressure, contributing to its failure to hold above $3,000.

The combination of negative ETF net flows and Ethereum’s recent price behaviorhelps explain rising unrealized losses. Interestingly, also reveal different instances of whale addresses reducing their exposure to Ethereum outside of spot ETFs. 

For instance, Lookonchain recently believed to be linked to Erik Voorhees, which swapped 4,619 ETH, valued at about $13.42 million, into Bitcoin Cash (BCH) over the past two weeks after having been inactive for nearly nine years. Voorhees later that the wallet does not belong to him and that he does not hold any Bitcoin Cash.

Lookonchain also pointed Arthur Hayes, co-founder of BitMEX, who has offloaded a total of 1,871 ETH at about $5.53 million in the past week.

Featured image from Unsplash, chart from TradingView