Ethereum Exchange Supply at 5.5-Year Low as $181 Million Leaves
Recent on-chain data reveals that Ethereum has experienced a significant outflow from exchanges, suggesting increased buying activity in the market. According to analytics firm Santiment, this outflow is the largest since August 21st. The metric being observed here is “supply on exchanges,” which tracks the total amount of Ethereum held in centralized exchange wallets.
A decrease in this metric indicates a net movement of coins away from exchanges, as investors transfer them to self-custodial wallets for long-term holding. Conversely, an increase suggests deposits moving towards exchanges, potentially signaling a forthcoming price correction or selling activity.
In contrast, there is another metric called “supply outside of exchanges,” which measures the amount of Ethereum stored in self-custodial wallets. This supply has been steadily increasing due to factors like validator rewards and new minted supply.
Ethereum Price Consolidation
Ethereum’s price has been consolidating around the $1,600 level following an unsuccessful recovery attempt in recent days.
Hot Take: Ethereum Exchange Outflow Signals Bullish Sentiment
Recent data showing a significant outflow of Ethereum from exchanges suggests a positive sentiment among investors. The decrease in supply on exchanges indicates a trend of long-term holding and potential buying activity. This could be an encouraging sign for Ethereum’s future price performance. However, it’s important to monitor market dynamics and consider other factors that may influence the cryptocurrency’s value. Overall, the current exchange supply trend reflects a positive outlook for Ethereum in the market.
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