Ethereum's standing in the current economy is under fire. | Source: CCN.
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Key Takeaways
Wintermute said Ethereum is ‘the wrong asset for this macro.’
It comes shortly after Tom Lee linked Ethereum’s weakness to rising oil prices.
Despite near-term pressure and ETF outflows, Wintermute said long-term crypto fundamentals remain intact.
Ethereum’s underperformance in the current macro environment has sparked debate among crypto market participants, with trading firm Wintermute arguing it is ‘the wrong asset for this macro.’
The comments come just a week after Ethereum bull Tom Lee linked the crypto’s current weakness to surging oil prices.
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In a weekly market note, Wintermute noted ETH had fallen 10.2% over the past week, underperforming Bitcoin across both spot and derivatives markets.
The firm pointed to a broad repricing across global markets after April US consumer price inflation came in hotter than expected at 3.8% year-on-year.
Meanwhile, the benchmark 10-year Treasury yield climbed to 4.58%, its highest level since September 2025.
Wintermute said the shift in macro expectations, including markets beginning to price in a possible Federal Reserve rate hike later this year, had weighed particularly heavily on Ethereum.
This is likely due to its stronger sensitivity to liquidity conditions and long-duration growth narratives, the firm said.
Tom Lee Also Linked Ethereum Weakness To Rising Oil Prices
The comments come a week after Fundstrat’s Tom Lee linked Ethereum’s recent weakness to surging oil prices, arguing the crypto’s inverse correlation with crude had reached historic levels.
“If one is wondering why Ethereum $ETH has been under selling pressure: to me, rising oil prices is the biggest headwind,” Lee wrote on X on May 18.
Adding: “ETH inverse correlation to oil is the highest ever.”
Lee added in a follow-up post that “as oil rose in the past six weeks, ETH prices have fallen.”
The famed analyst described the relationship as a short-term tactical headwind, but claimed he remained bullish on Ethereum’s long-term outlook.
As usual, Lee cited tokenization and artificial intelligence as key structural growth drivers that would strengthen demand for the blockchain through 2026.
Lee Says Ethereum’s Recovery Signals End Of ‘Crypto Winter’
Lee’s latest remarks came only days after he argued that the crypto market had already emerged from its prolonged downturn.
He pointed to Ethereum’s recent price action as evidence that broader bear-market conditions in crypto may already be fading.
“There’s never been a crypto winter where Ethereum has closed up three consecutive months in a row,” Lee said.
The comments, along with his subsequent ones, have received backlash from some members of the crypto community.
One X user wrote: “What happened to ‘ETH is the best performing asset since the war started’?,” referencing a quote from Lee from earlier this month.
Wintermute Warns Of Tougher Environment For Crypto Assets
Wintermute’s broader market outlook echoed concerns about a more challenging environment for crypto assets in the near term.
“BTC failed at the 200-day on the first real macro shock, which tells you it was the squeeze driving it all along,” the firm wrote in its market commentary.”
The trading firm said institutional investors appeared to be ‘selling into strength’ rather than adding exposure during the recent rally.
Wintermute noted that Bitcoin spot ETFs recorded $1 billion in outflows over the week while Ether ETFs saw $255 million leave the market.
However, the trading firm said several long-term indicators remained constructive for digital assets.
These included:
Low exchange reserves
Continued accumulation by long-term holders
Growing adoption of tokenized Treasuries, which have now reached $15 billion on-chain.
While risks remain, it said the structural case for blockchain adoption had not changed, even if investors may need time to digest the evolving macro backdrop.
Broader Bear Market Fears Persist
The cautious tone from Wintermute also reflects a broader debate within the industry over whether Bitcoin can sustain a recovery.
Despite continued accumulation by long-term holders, some analysts remain skeptical that Bitcoin will revisit the $100,000 level anytime soon.
Crypto analyst Benjamin Cowen recently said Bitcoin could eventually revisit levels below $60,000 and potentially fall toward $40,000 later in the current market cycle as macroeconomic pressures persist.
“My guess, unfortunately, is that the bear market is unlikely to be over,” Cowen said during an appearance on the Mr. M Podcast.
Meanwhile, Motley Fool analyst David Jagielski recently wrote that lower interest rates could help revive demand for risk assets, while higher borrowing costs may continue pressuring crypto prices.
“It’s difficult to determine where Bitcoin may go since a lot ultimately depends on government actions,” he added.
Adding: “While Bitcoin might one day get back to $100,000, I don’t think that’ll happen anytime soon.”
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
