Ethereum ETFs Have Lost $1.1 Billion in Three Weeks. What Would Bring Buyers Back?

Investors have pulled about $1.1 billion from U.S. spot Ether (CRYPTO: ETH) ETFs over the last three weeks, and the selling hasn’t stopped. These funds directly hold ETH, so when investors withdraw, they often have to sell coins to meet demand.

This situation has also significantly impacted Coinbase (NASDAQ: COIN), which serves as the custodian for most U.S. spot crypto ETFs. On October 23, 2026, Coinbase shares closed at about $164, down 17% over the past month. So what could attract ETF buyers back into the market?

Ethereum ETF Outflows Slowed Each Week but Never Stopped

Ethereum spot ETFs have steadily lost funds, with net outflows of $542.1 million recorded from October 5 to 9, according to SoSoValue. Another $320 million followed in outflows from October 12 to 16.

The trend persisted with an additional $225 million leaving over just four trading days from October 19 to 22, including a striking $110.5 million on October 22 alone. The complete figures for October 23 are still pending.

Notably, one fund drove most of the withdrawals. BlackRock’s iShares Ethereum Trust (NASDAQ: ETHA) saw approximately $1.01 billion exit during this timeframe, accounting for about 93% of the total outflows. Its net assets fell from roughly $9.9 billion on October 5 to around $7.8 billion on October 23—the day it recorded zero flows.

Between October 19 and October 22, ETHA’s withdrawals totaled about $233 million, surpassing the $225 million total outflow for all funds in the same period. This suggests that while money is moving out of ETHA, some investors are reallocating their funds to other Ether ETFs, keeping their investment within the Ethereum ecosystem.

Three Forces Are Pushing Investors Out of Ethereum ETFs

Yield competition is the first factor. Many investors are attracted to staking options, which involve locking up ETH to help secure the Ethereum network in exchange for rewards. Staking funds distribute this yield to their shareholders. BlackRock also manages the iShares Staked Ethereum Trust ETF (NASDAQ: ETHB), meaning traditional Ether funds now compete with income-focused options.

Falling prices are the second. ETH has dropped 11.5% in October, trading around $2,361 and is down 20% year-to-date. Falling prices can trigger ETF redemptions, creating a cycle of further selling pressure.

Development delays are the third. On October 22, Ethereum developers announced a delay in the Glamsterdam upgrade’s test on the Hoodi network, initially scheduled for October 26. The Ethereum Foundation said developers need more time to assess how a proposed change interacts with existing smart contracts. Without a new timeline, this is another setback for ETH holders seeking immediate catalysts.

Despite these outflows, the funds still hold $14.6 billion in net assets, compared to $12.7 billion in total net inflows. This discrepancy exists because ETH prices have risen since most of that investment was made, meaning early holders may still see profits despite recent downturns.

Coinbase Feels Every Dollar That Leaves Ethereum ETFs

Coinbase benefits from custody and ETH staking, so a decline in ETH demand affects its revenue streams. In its Q2 2026 earnings report released on July 30, Coinbase reported an 18.5% year-over-year revenue drop to $1.22 billion. Platform assets also fell from $294 billion to $246 billion, with executives citing ETF outflows as a contributing factor.

In discussions with analysts, Coinbase’s Alesia Haas stated, “When customers store with us, they transact with us.” This works both ways—fewer stored assets reduce trading revenue. Over the past week, Coinbase’s stock slipped 5%, while it’s down 27.3% year-to-date.

Large transactions have also drawn attention. Whale Alert reported transfers such as 38,236 ETH, valued at $91.7 million, moving into Coinbase Institutional and another 37,568 ETH, worth $90 million, going from Coinbase Institutional to regular Coinbase. While incoming coins could suggest selling intentions, many internal transfers are routine custody actions.

What Could Bring Ethereum ETF Buyers Back?

A reversal in ETH’s price trend is likely the first step in getting buyers back on board. Historically, ETF flows have closely followed price movements. Despite recent struggles, ETH is still up 21.6% over the last 90 days, so a price recovery could reignite momentum and interest among investors. More ETFs offering staking may also encourage yield-seeking holders to switch funds while keeping their investments in ETH.

Additionally, progress on the Glamsterdam upgrade could inspire renewed confidence if a new date is announced. Notably, weekly outflows have fallen sharply from $542.1 million to $320 million, then to $225 million, suggesting buyers may be poised to return. Should this trend turn into a week of net inflows while ETH stabilizes, Coinbase’s forthcoming quarterly report should reveal the true impact of the ETF selling trend.

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