Ethereum price stuck at $3,000 as ETH exchange balances keep melting to 2-year low but still have bullish outlook

By Selena On Aug 18, 2021

According to data from CryptoQuant, ETH exchange balances keep melting as analytics data on Ethereum wallets shows several new all-time highs achieved recently. Meanwhile, at press time, Ethereum price is changing hands at $3,006, recorded an 8% drop in the last 24 hours.

ETH/USD 4-hour chart | Source: TradingView

ETH exchange reserves drop to a 2-year low, While Ethereum price shows an 8% drop

ETH supply on centralized cryptocurrency exchanges continues to shrink as users withdraw it to either put it into cold storage, use it in yield-farming projects, or send it to the Ethereum 2.0 deposit contract, according to Santiment.

Source: CryptoQuant

Furthermore, the figures are showing that investors continue to withdraw ETH from crypto exchanges. The downward trend of ETH balances continues, and the number of ETH withdrawals from trading platforms (7-day moving average) has hit a one-month high of 1,769,625. This resulted in Ethereum price being stuck in the $3,000 region and so far holding there.

Meanwhile, according to Glassnode, currently, the amount of Ethereum deposited into the ETH 2.0 contract has reached a staggering 6,837,922 ETH – a new all-time high and an increase of 100,000 ETH in two days.

“Ethereum Total Value in the ETH 2.0 Deposit Contract just reached an ATH of 6,837,922 ETH. Previous ATH of 6,837,890 ETH was observed on 17 August 2021”, Glassnode stated.

Source: Glassnode

The number of ETH wallets with non-zero balances has hit a new all-time high, reaching 59,909,435 addresses. The number of new ETH wallets has soared to a one-month high, and now it constitutes 3,861.976. Besides, more users are acquiring large amounts of Ether as the number of addresses that hold 1,000 ETH or more has hit the highest point in 3 months – 6,416.

Regarding the price situation, many argue that ETH can beat BTC to all-time highs. Ki Young Ju, CEO of on-chain analytics service CryptoQuant, said that a sell-side liquidity crisis could yet give ETH over BTC.

“ETH might reach its all-time high earlier than $BTC in the long term. 1/ Current ETH price is closer to ATH compared to BTC. 2/ Higher demand, lower supply. $ETH sell-side liquidity crisis still intensifies, while BTC exchange reserve stopped its downward trend in May”, Ju commented.

ETH Exchange Netflows | Source: Ki Young Ju/Twitter

In terms of numbers, Bitcoin exchange reserves have been declining since May, only to return in late July. From a peak of 2.54 million on July 26, BTC reserves declined to 2.44 million this week.

And the downtrend, as mentioned above by AZCoin News, is an indication of a sell-side liquidity crisis that could yet make Ether beat Bitcoin to new all-time highs.

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