- Data shows Ether (ETH) deposits on cryptocurrency exchanges dropping to a 2-year low
- Trend points to diminishing sell-side supply and rising buy demand
- ETH/USD could reclaim its previous all-time high much before Bitcoin
JAIPUR (Coinchapter.com) – Ether (ETH) deposits on cryptocurrency exchanges followed a steady downtrend, latest data from CryptoQuant showed.
ETH reserves have been dropping out of crypto exchanges since August 2020. Crypto trading platforms collectively held 26.23 million coins then. The number gradually reduced to 19.25 million by August 17, 2021. A sharp upward reversal in ETH exchange deposits during the May selloff led ETH/USD exchange rates down to $2100.
But overall, the deposit depletion rate has remained intact, with figures touching a 2-year low on Wednesday.
And while long-term investors continued drawing their ETH holdings off crypto bourses, Ethereum’s daily network growth logged a new high.
“…we’re seeing that network growth has been steadily rising this month. New addresses being created on the $ETH network is a nice leading indication of where prices move next.’tweeted Santiment
Another Bullish ETH Price Run Brewing?
Sustained exchange withdrawals and new daily address growth spurred a bullish scenario for ETH/USD. Sell-side supply reached a bottleneck as buyers and accumulators jacked up their demand in line with healthy long-term prospects.
CryptoQuant CEO Ki-Young Ju indicated that the same could drive Ethereum’s native asset to approach its previous all-time high much earlier than Bitcoin. And his reasons?
“1/ Current $ETH price is closer to ATH compared to $BTC.
2/ Higher demand, lower supply. $ETH sell-side liquidity crisis still intensifies…”
Analyst Lark Davis noted that the rising demand and falling supply could eventually lead ETH prices to five figures over the long term.
“#ethereum long term will easily hit 5 digits, rising demand, falling supply, and a perpetual buy and burn mechanism are rocket fuel!”said Lark
The institutional adoption factor could fuel the five-figure run as well.
“Institutional adoption of #Ethereum driving next leg of bull mkt in #Crypto mkts. NYDIG, Fidelity, Cathie Wood’s Ark all moving in. Raoul Pal calls #ETH “greatest 6-9 month trade in the HISTORY of financial mkts.” Eth for defi/nfts/staking in face of burn means 10k possible.”observed global macro investor Dan Tapiero