Arbitrum’s native token ARB fell 10% despite strong network growth, as significant capital outflows and bearish derivatives positioning overwhelmed positive fundamentals. On-chain data shows approximately $56.9 million exited the network, primarily to Ethereum and Hyperliquid, while negative funding rates indicate traders are betting on further decline.
Arbitrum’s ARB token fell sharply by 10% despite improving network fundamentals. The decline was notably driven by on-chain capital rotation rather than just perpetual futures traders.
Fundamental metrics suggested potential for a rebound. Daily Active Users climbed to 4.3 million, with an average of approximately 26 transactions per user.
However, substantial on-chain outflows created a bearish tilt. Artemis reports that Arbitrum recorded the largest bridged net outflow among major chains, with approximately $56.9 million exiting.
Most of this capital rotated to Ethereum and Hyperliquid. Specifically, Ethereum absorbed roughly $34.7 million, while Hyperliquid attracted about $17.7 million.
Market sentiment shifted significantly alongside the price drop. Data from CoinMarketCap shows bullish conviction for ARB fell from 83% to 48%.
The derivatives market amplified the downside pressure. The OI-Weighted Funding Rate turned negative, indicating a growing share of Open Interest is positioned for further decline.
Approximately $3 million in fresh liquidity entered the derivatives market, largely reinforcing short exposure. For every $1 lost by short traders in the past 24 hours, long traders lost approximately $37.
The current technical structure favors sellers, with price declining while volume rises. Both spot-driven capital rotation and derivatives positioning suggest bearish momentum remains elevated.
