The supply of Ethereum on exchanges has been steadily declining since the FTX crash in 2022, as reported by credible sources. This decline can be attributed to a growing distrust for centralized exchanges, leading investors to choose self-custody of their tokens. As a result, the amount of Ethereum held on exchanges has reached its lowest point since its inception.
When the Ethereum network was first launched in 2015, the available ETH on exchanges was naturally low due to its status as a new player in the market. However, over the years, as Ethereum gained widespread acceptance and began trading on numerous exchanges, the exchange balances steadily increased.
Recently, there has been a shift in investor behavior, with crypto investors opting to hold their ETH in private wallets rather than leaving them on exchanges. This has resulted in only 8.41% of the total circulating supply of ETH being available on exchanges.
According to on-chain data tracker Santiment, this is the lowest level of Ethereum exchange balances since Genesis in 2015. Santiment stated, “Prices crossed $1,850 for the first time since August 15th, and the now 8.41% of $ETH supply on exchanges is the lowest since #genesis in 2015. Whale transactions also hit a 6-month high.”
The move away from exchanges coincides with a rapid increase in the price of Ethereum, suggesting that holder accumulation has played a significant role in the digital asset’s recovery. If exchange balances continue to decline, indicating less willingness to sell off ETH and lower sell pressure, the value of Ethereum could continue to rise.
In terms of price targets for Ethereum bulls, the next significant resistance lies at $1,850. Clearing this level will be crucial in establishing a stronger bull trend. The $1,920 level is expected to pose a major roadblock for the ETH price, with bears likely to put up strong resistance. Finally, reclaiming the $2,000 mark would be a significant milestone for Ethereum and could signal an end to the downward trend.
In conclusion, the decreasing supply of Ethereum on exchanges and the shift towards self-custody by investors have had a significant impact on the digital asset’s price. As exchange balances continue to fall, the value of Ethereum could continue to soar, with bulls eyeing key resistance levels to establish a stronger bull trend.
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