The open interest-weighted funding chart reflected the same pattern. Earlier this week, OI-weighted funding ranged between 4% and 8% APR, showing long exposure among larger traders. As price weakness spread, OI-weighted funding also slipped below zero. This shift showed bearish positioning expanding even among high-conviction participants.
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By January 22, both funding measures recovered above zero as ETH rebounded toward $3,000 to $3,100. Still, rates remained below earlier highs, suggesting limited risk appetite. Institutional concerns added pressure. US-listed Ether spot ETFs saw $230 million in net outflows on Friday, reversing the prior week’s average inflows of $96 million.
These ETFs hold over $17 billion worth of ETH, creating a notable supply overhang. Meanwhile, ETH-focused treasury firms such as Bitmine Immersion and Sharplink reported heavy accounting losses. To gauge professional sentiment, traders also monitored ETH options skew. The metric rose to an 11% downside premium, the highest level in seven weeks.
When downside protection trades at such a premium, what does it signal about market confidence after repeated rejections near $3,400 over the past ten weeks?