Ethereum sentiment weakened sharply in May as traders reacted to price pressure, ETF outflows, foundation withdrawals, and slowing network growth.
Santiment said Ethereum has seen a sharp change in market mood, with its market capitalization declining 11.6% in 15 days. The data platform said: $ETH If selling pressure continues, the currency is at risk of falling below $2,000 for the first time since late March.
According to the report, Ethereum’s social dominance increased, but the price continued to decline. While this pattern may indicate increased attention, Santiment said the tone of the discussion has moved toward fear and frustration rather than optimism.
Mr. Santiment also provided bullish and bearish comments on: $ETH It approached equilibrium in May. As of late April, bullish comments still significantly outnumbered bearish comments. By May, the ratio was close to 1.0, indicating that traders were far less confident.
ETF outflows will weigh on us $ETH request
ETF flows are one of the major pressure points. Santiment said there were outflows from several Ethereum ETF products over May, including large withdrawals from BlackRock-related funds. He also said that the Ethereum ETF has not recorded a day in which total inflows exceeded $50 million in the past three weeks.
📉 Ethereum sentiment has undergone a major reversal, with the retailer quickly jumping from the second-largest cryptocurrency by market capitalization. ETF outflows, foundation departures, slowing network growth and unstoppable bearish narrative have traders wondering $ETH Like never before. This is our view. 👇https://t.co/RDpVPbdIZs pic.twitter.com/y7JPlcZEPK
— Santiment Intelligence (@SantimentData) May 22, 2026
A related report also shows why traders are focusing on the $2,000 area. Previous market reports stated that the Ethereum ETF recorded net outflows of more than $340 million in six trading sessions. $ETH I had a hard time getting my $2,150 back.
JPMorgan also warns that demand for Ethereum is weak compared to Bitcoin. The bank said Bitcoin ETFs have recovered about two-thirds of recent outflows, while Ether ETFs have only recovered about one-third. I also said $ETH And without stronger DeFi activity and real-world use cases, altcoins are likely to continue to lag.
Foundation withdrawal raises traders’ suspicions
Changes at the Ethereum Foundation also contributed to the weak mood. Recent reports have noted that Karl Beek and Julian Ma have announced their departure from the Ethereum Foundation, and changes have been made to the broader protocol cluster.
Santiment said traders are often quick to react to such stories. It also added reports about the foundation’s withdrawal and public claims. $ETH Supporters’ reduced exposure contributed to the current bearish mood. Although some of these claims lacked full context, they nevertheless shaped traders’ behavior.
The report also noted that Ethereum’s development activity remains strong. Santiment said that even though retail traders are eyeing faster price movements from competing ecosystems, Ethereum still leads with untapped developer work.
Network growth remains a market test
Santiment said daily active address and network growth has slowed from a strong period in 2024 and 2025. The number of new wallets interacting with Ethereum is decreasing, and traders may read this as a sign of declining demand for Ethereum. $ETH.
Based on market data crypto.news, Ethereum was trading around $2,125 to $2,135 as of May 22. it maintains $ETH It is close to the support zone that traders are focusing on following recent capital outflows and technical weakness.
Santiment said: $ETH For now, the market is focused on whether Ethereum can recover demand, defend the $2,000 area, and prove that network usage can recover faster than trader confidence erodes.
