Ether fell to a two-month low with liquidations outpacing bitcoin's despite a much smaller derivatives market, while VanEck withdrew its planned Lido staked-ether fund.
Wednesday night's crypto selloff hit ether harder than bitcoin, and the pattern points to where leverage had built up.
Ether fell about 5.3% over 24 hours to roughly $2,372 at about 4:45 a.m. ET Thursday, after touching $2,332, its lowest level in two months. Bitcoin fell 2.7% over the same period. Ether is now well below its 50-day moving average of about $2,554.
Where the leverage was
About $286 million of ether positions were liquidated over 24 hours, compared with $197 million for bitcoin, according to CoinGlass data. That is the reverse of what the size of the two markets would suggest: open interest in ether futures is about $30 billion, against about $52 billion for bitcoin.
More liquidations in the smaller market suggest ether longs were more crowded relative to its size. When prices fell, forced selling did more damage.
The spot market added to the pressure. U.S. spot ether exchange-traded funds had net outflows of $129.5 million on Wednesday, according to Farside Investors data, led by $109.8 million from BlackRock's ETHA. The Grayscale Ethereum Mini Trust lost $18.8 million.
The withdrawn fund
On the same day, VanEck filed to withdraw the registration for its VanEck Lido Staked Ethereum ETF. The fund was designed to hold stETH, the token issued by the Lido protocol to represent staked ether and the rewards it earns. VanEck first filed the registration in October 2025. The fund never became effective, and no shares were sold. VanEck did not give a specific reason.
The withdrawal removes the first proposed U.S. ETF to hold Lido's stETH. A separate VanEck fund that would hold JitoSOL, a Solana liquid-staking token, is still awaiting a decision. The withdrawal also does not end staking in ETFs: funds that stake ether directly through their own arrangements continue to trade. Without a specific reason, the filing cannot be read as a sign of regulatory resistance. A commercial decision is equally possible.
Two readings
The first is that ether's underperformance is a leverage flush. Crowded positions were cleared, and once forced selling ends, ether tends to trade back in line with bitcoin.
The second is that ether faces a demand problem of its own. ETF outflows, a two-month low and the loss of a product designed to bring staking yield to traditional investors all point to softer institutional appetite.
What to watch
Thursday's ETF flow data, whether ether can recover its 50-day average, funding rates in ether perpetual futures as a gauge of whether leverage is rebuilding, and any statement from VanEck or Lido on the withdrawal.