As Ethereum Drops Below $2,000, Futures Open Interest Hits All-Time High, Signaling Increasing Bearish Sentiment in the Market

May 28 marked a key point for Ether (ETH), as the crypto asset fell below the $2,000 threshold for the first time since March this year. Over the past seven days, ETH has shed nearly 8% in value, with a more than 5% drop in just the last 24 hours. Meanwhile, open interest (OI) for ETH futures has climbed for three consecutive days, hitting an all-time high of 16.39 million ETH, equivalent to roughly $32.5 billion in nominal terms. Analysts interpret the continued rise in OI amid spot price declines as a sign of increasingly aggressive leveraged shorting in the market. 10x Research founder Markus Thielen noted that more investors are abandoning ETH, citing the cryptocurrency’s lack of cash flow generation. Adding to that pressure, rising U.S. bond yields are making staking yields on ETH far less attractive. Compounding these headwinds, U.S. spot ETH ETFs saw $401 million in net outflows this month—a full reversal of April’s $354 million net inflow. Market sentiment has also soured due to the departure of key members from the Ethereum Foundation. Bankless co-founder David Hoffman previously revealed he sold all his ETH holdings, arguing the “ETH is money” narrative has already been fully priced into the asset. Web3 research firm House of Chimera added that the market is now questioning whether Ethereum’s ecosystem advantages in decentralized finance (DeFi), real-world assets (RWA), and tokenization will actually translate to tangible value for the ETH token itself.