Institutional Flows Flip: Fidelity’s Ethereum ETF Records $11.6M Outflow — Profit-Taking or Confidence Crack?

Fidelity U.S. Ethereum ETF logged a –$11.6 million daily outflow on October 17, according to Farside Investors. The move raises questions about short-term institutional sentiment toward ETH and whether capital rotation is shifting toward Bitcoin or risk-off assets.

Institutional sentiment around Ethereum may be showing early signs of hesitation. Data from Farside Investors confirms that Fidelity’s U.S. Ethereum ETF recorded a net outflow of $11.6 million — one of its largest daily redemptions since launch.

The outflow stands in sharp contrast to recent inflows into Bitcoin-linked ETFs, suggesting that large fund managers could be rebalancing portfolios in anticipation of continued market volatility. Analysts note that part of this move could also reflect profit-taking after ETH recovery above $3,900 last week, rather than outright loss of confidence.

Blockchain analytics from Santiment show a modest rise in stablecoin balances across institutional wallets, hinting that capital may be moving to the sidelines. Meanwhile, CoinShares reported mixed flows across other Ethereum products: inflows into European ETPs were offset by U.S. redemptions, resulting in a net global outflow of roughly $8 million.

Market strategist James Check from Glassnode wrote on X that the rotation might be temporary:

“ETH has lagged BTC in this macro cycle, so when volatility spikes, money flows to the dominant asset first. It’s not bearish — it’s defensive positioning.”

Still, traders will be watching the ETF flow data closely in the coming days. Persistent outflows could weigh on sentiment and ETH price momentum as institutional holders trim exposure ahead of year-end rebalancing.

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