Coinbase Faces Ethereum Demand Headwinds as Institutional Interest Wanes

Recent market data reveals a significant cooling in U.S. institutional demand for Ethereum, with Coinbase and other major platforms experiencing reduced trading volumes and ETF stagnation. The decline in Bitcoin's price has created ripple effects across cryptocurrency markets, particularly impacting Ethereum's spot demand. Analysis shows the seven-day average outflow from U.S. spot Bitcoin ETFs has reached 281 BTC—the lowest level since April—while Ethereum ETF inflows have remained stagnant since mid-August. Market experts point to the closure of Grayscale's arbitrage window and broader macroeconomic risk reassessment as primary drivers behind this trend. The initial surge in Ethereum ETF investments appears to have plateaued, suggesting institutional investors are adopting a more cautious approach amid current market pressures. This development signals potential challenges for cryptocurrency exchanges like Coinbase that rely heavily on institutional trading activity and ETF-related revenue streams.

U.S. Institutional Demand for Ethereum Cools Amid Market Pressures

Ethereum's U.S. spot demand has weakened significantly as Bitcoin's price decline reverberates across crypto markets. The seven-day average outflow from U.S. spot Bitcoin ETFs reached 281 BTC—the lowest since April—while ethereum ETF inflows have stagnated since mid-August.

Market analysts attribute the slowdown to a closed Grayscale arbitrage window and macroeconomic risk reassessment. "Early Ethereum ETF inflows were driven by reallocation mechanics, not conviction," notes Bitget Wallet researcher Lacie Zhang, referencing capital shifts from Grayscale's ETHE product.

Total liquidations hit $832 million as Bitcoin dipped 2.8% to $108,201, with long positions bearing $666 million of the damage. Despite short-term pressures, the long-term outlook remains bullish, hinging on Ethereum's utility growth and real-world asset adoption.

SpaceX Moves $31M in Bitcoin Amid Corporate Treasury Reshuffle

Elon Musk's SpaceX transferred 281 BTC ($31 million) from Coinbase Prime custody to a new wallet on Wednesday, continuing a series of recent on-chain movements. The aerospace firm now holds 8,285 BTC ($894 million), maintaining its position as the fourth-largest corporate bitcoin treasury.

Arkham Intelligence data shows the company shifted holdings previously dormant for three years. While SpaceX hasn't disclosed intentions, the transfers coincide with Bitcoin's institutional adoption trend among tech-forward corporations.

Notably, SpaceX's treasury once peaked at 25,000 BTC in 2022 before apparent divestments. Market observers note such moves by major holders often precede strategic reallocations rather than outright sell-offs.

Webull Expands Crypto Futures Offerings with Solana, XRP, and Dogecoin Amid Institutional Demand

Webull has launched futures contracts for major altcoins including Solana (SOL), XRP (XRP), and Dogecoin (DOGE), leveraging its partnership with Coinbase Derivatives. The platform will also list Litecoin (LTC), Nano XRP, and Nano Solana futures, marking a strategic push into crypto derivatives.

Anthony Denier, Group President of Webull, attributes the surge in crypto futures activity to institutional inflows, particularly into Bitcoin ETFs, alongside growing retail participation from APAC markets. Coinbase's derivatives expansion, including its Deribit acquisition, signals broader institutional adoption of crypto hedging instruments.

Solana Whales Stir as ETF Inflows Counterbalance Supply Pressure

Solana's market dynamics reveal a nuanced interplay between long-term holders and institutional demand. Early investors have begun moving dormant SOL holdings to exchanges, with Arkham Intelligence tracking a $40 million transfer to Coinbase Prime. Such movements typically signal distribution, but this cycle differs fundamentally.

Regulated investment products are absorbing the supply shock. Solana-focused ETFs have drawn $381 million in October alone, pushing year-to-date inflows to $2.8 billion. The capital wave transforms what might appear as bearish on-chain activity into a liquidity-driven repositioning.

CryptoQuant data shows whales dominating spot trades, yet their selling coincides with peak ETF appetite. This mirrors patterns seen in Bitcoin and Ethereum cycles, where veteran investors time exits to institutional buying waves rather than market weakness.

Coinbase Beats Q3 Forecasts as Transaction Revenue Jumps to $1 Billion

Coinbase reported $1.9 billion in third-quarter revenue, surpassing Wall Street expectations by 26% quarter-over-quarter. The exchange posted $433 million in net income, a decline from the previous quarter's $1.4 billion but a significant improvement from $75 million a year ago. Transaction revenue surged to $1 billion, driven by heightened activity in Bitcoin and Ethereum, which reached all-time highs during the period.

Shares ROSE to $341 in after-hours trading, capping a 33% year-to-date gain. The rebound follows a second-quarter slowdown attributed to macroeconomic uncertainty. Institutional and retail traders returned to the platform as crypto markets regained momentum.

Coinbase Defends Stablecoins Against Claims of Threatening US Banks

Coinbase has dismissed concerns that stablecoins pose a risk to US bank deposits, arguing instead that they reinforce the dollar's global dominance. The exchange contends that stablecoin demand is primarily driven by international markets seeking dollar exposure, particularly in regions with volatile currencies or limited banking access.

Faryar Shirzad, Coinbase's Chief Policy Officer, emphasized that stablecoins operate as a parallel financial system, with two-thirds of transactions occurring on DeFi platforms. This dynamic, he argues, positions stablecoins as a strategic tool for expanding the dollar's reach rather than competing with traditional banks.