Why Institutions Are Depositing Ethereum to Centralized Exchanges?
Recent data from Spotonchain reveals that Celsius Network has deposited 10,000 Ethereum (ETH) worth $23.56 million to Coinbase. This move by Celsius Network is part of its efforts to distribute Bitcoin and Ethereum to its creditors through centralized exchanges like Coinbase. In the past two weeks alone, Celsius Network addresses have deposited a total of 47,100 ETH worth $107.7 million on Coinbase. Similarly, Alameda Research has also transferred 1,550 ETH worth $3.67 million to Coinbase.
Increased Supply on Centralized Exchanges
The supply of Ethereum on centralized exchanges has been increasing. FTX and Alameda Research, along with other institutions like Celsius Network, have deposited a significant amount of ETH into crypto exchanges since October 2023. Additionally, former US President Donald Trump has reportedly dumped $2.8 million worth of ETH on centralized exchanges. The balance of ETH on centralized exchanges has seen a significant increase in the past week, reaching over 132,560 ETH.
Hot Take: Will Increased Supply Hinder the Ethereum Rally?
The recent influx of Ethereum onto centralized exchanges raises concerns about the potential impact on the ETH rally. While institutions like Celsius Network and Alameda Research deposit their ETH to these exchanges for various reasons, it remains uncertain whether they will sell the ETH or distribute it to their creditors. The increased supply on centralized exchanges could potentially create selling pressure and hinder the upward momentum of Ethereum’s price. Traders and investors should closely monitor the supply dynamics and market conditions to make informed decisions regarding their Ethereum holdings.
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