ETH recently fell below $2,000, erasing gains made since the second quarter. Foreign media, citing Nansen research, suggest that this weakness is not solely due to a general correction in risk assets; demand for ETH itself is also under pressure.
ETFs continue to see outflows
The report noted that since May 11, the US spot ETH ETF has seen net outflows for several consecutive trading days, with a cumulative outflow of $522 million in May, the highest level since December last year. Meanwhile, the ETH/BTC ratio has fallen to approximately 0.027, a one-year low.
According to Nansen, this ratio reflects the allocation of funds in this cycle better than price alone. Since 2026, Bitcoin has consistently attracted institutional attention, while ETH has not yet received the same level of demand.
Mainnet demand remains weak
Besides funding factors, on-chain data is also weakening ETH's support. The report cites analysts as saying that Ethereum gas fees have fallen below 2 gwei, close to the low point of this cycle, indicating weak mainnet transaction demand and a decrease in contract calls and transfer activity.
This directly impacts the rate at which ETH is burned. As the burning slows, the deflationary narrative that previously supported ETH has clearly cooled down. At the same time, Layer 2 is handling more transaction volume, diverting revenue that originally belonged to the mainnet.
$1800 becomes a key level to watch.
In terms of capital outflow, ETH's realized market capitalization has decreased from $310 billion to $295 billion this year, meaning that approximately $15 billion has flowed out during the year. The report concludes that overall market demand for ETH remains weak.
It's worth noting that some large addresses are buying on dips. Wallets holding more than 100,000 ETH currently control approximately 17.4 million ETH, representing about 22% of the total supply, a 10-week high. However, this increase in holdings is not yet sufficient to reverse the overall capital outflow.
Foreign media reports suggest that if institutional demand and network activity do not improve in June, ETH may continue to test lower support levels, with the market focusing on the $1800 area. Price pressure may ease only if spot ETFs return to net inflows or on-chain demand rebounds significantly.
