- Ethereum remains one of the few mega-cap assets still holding May gains.
- BlackRock has deployed $50 million into ETH in just 10 days, signaling a strategic move amid tightening supply.
Among mega-cap assets, Ethereum [ETH] stands out as one of the few still holding onto its May gains, currently trading over 3% above its early-May levels.
But this resilience isn’t accidental.
Instead, it appears to be part of a calculated allocation strategy by BlackRock. You see, over the past ten days alone, the firm has deployed $50 million into ETH.
For an institution built on performance, such capital deployment isn’t speculative.
Could this, then, be a signal that BlackRock is positioning ahead of a broader market repricing, with Ethereum’s once-distant $3k target now within striking distance?
Inside BlackRock’s strategic Ethereum bet
In less than a week, nearly $700 million slipped out of BlackRock’s Bitcoin [BTC] spot treasury (IBIT), with one day alone seeing almost half a billion in outflows.
But it’s not just the ETF, BlackRock also liquidated approximately 5,400 BTC, amounting to a substantial $56 billion sell-off on the 30th of May.
Consequently, this significant unwind contributed to heightened market volatility, triggering risk-off sentiment that pushed BTC to retrace back to $100k by the 5th of June.
Naturally, one would expect Ethereum to mirror this downturn, especially with millions wiped from derivatives.
However, ETH demonstrated relative resilience, limiting losses to 6.8% compared to BTC’s double-digit decline.
In fact, ETH settled into a tight trading range, indicating reduced volatility and more stable price dynamics relative to Bitcoin.
As previously mentioned, this resilience isn’t a fluke. Instead, this stability aligns with strategic capital flows.
Beyond BlackRock’s direct accumulation, its Ethereum ETF (ETHA) recorded nearly $319 million in inflows over the past week, marking the first sustained weekly inflows since the November 2024 rally.
According to AMBCrypto, such consistent demand signals a deliberate strategic allocation. Hence, reinforcing BlackRock’s positioning in Ethereum as a part of a broader, data-driven investment thesis.
Does it know something the market doesn’t?
Given the scale of BlackRock’s investment, it’s a fair question to ask – Does the world’s largest asset manager see something the broader market is missing?
Ethereum’s on-chain and market structure data suggest so. Right now, ETH supply on cold wallets is at a 7-year low. At the same time, over 340,000 ETH are sitting in the staking queue, waiting to be locked up for yield.
So we’ve got less ETH circulating, and more getting sidelined. Then there’s the derivatives market. In May, ETH open interest exploded past $35 billion, even higher than during the last bull market peak.
Put it all together, and it looks like BlackRock is betting on a structural supply squeeze.
With more ETH being locked for staking, long-term holds, or leveraged futures, the amount available for trading keeps shrinking, and that’s exactly where their thesis might be taking shape.
In turn, making the elusive $3k target look a lot closer, and turning Ethereum’s current consolidation into a strong setup for a potential breakout.
