Ethereum has continued to decline recently, primarily driven by a combination of shifting expectations for U.S. monetary policy, declining risk appetite across the cryptocurrency market, and ETF capital outflows.
On the macroeconomic front, U.S. October CPI data exceeded market expectations. Coupled with recent hawkish signals from Federal Reserve officials, the market has further raised expectations for a year-end interest rate hike. According to CME FedWatch data, the probability of a 25-basis-point rate hike by the Fed in December has climbed to 91.9%, up from approximately 84% the previous day. Meanwhile, the 10-year U.S. Treasury yield rose to 4.996%, pushing the U.S. Dollar Index toward 102.22, near its highest level since October 28.
A stronger U.S. dollar and rising Treasury yields suggest that financial market liquidity conditions could tighten further, putting pressure on risk assets such as Ethereum. Higher interest rates enhance the relative appeal of holding U.S. dollar assets while dampening investors' willingness to allocate to highly volatile crypto assets. Bitcoin (BTC) and Ethereum are both currently trading near three-month lows, reflecting broad-based pressure across the cryptocurrency market.
In terms of capital flows, U.S. spot Ethereum ETFs have also experienced noticeable outflows recently. According to CoinGlass data, U.S. spot Ethereum ETFs recorded net outflows of approximately $184.6 million on November 9, signaling weakening institutional demand. Continued ETF outflows could increase market selling pressure, while also reflecting that some investors are reducing their allocations to Ethereum-related assets.
In addition, deleveraging across the derivatives market has exacerbated price volatility. CoinGlass data shows that liquidations in the Ethereum futures market totaled approximately $258 million over the past 24 hours, with long liquidations accounting for roughly $194 million. The concentrated liquidation of long positions further amplified Ethereum's decline.
