Ethereum balance on crypto exchanges falls to lowest levels since 2018

The Ether native token of Ethereum (ETH) has dropped to its lowest level since September 2018. This indicates that traders intend to keep the tokens in anticipation of a price rise in 2022.

According to Glassnode data, almost 550,000 ETH, or $1.61 billion, have been expelled from centralized trading platforms in the past year. This massive outflow has brought down the net-Ether balance of the exchanges to 21.72million ETH, a decrease from the record 31.68 million ETH reached in June 2020.

Balance of Ethereum on all exchanges, March 18, 2022 Glassnode

Largest weekly ETH outflow since Oct 2021

Data from IntoTheBlock indicates that over 30% of all Ether withdrawals from cryptocurrency exchanges in 2022 occurred earlier this week. Detail: More than 180,000 ETH were withdrawn from crypto trading platforms by March 15, bringing the weekly outflow to just over $500 million.

Ethereum net exchange flows. Source: IntoTheBlock

Chainalysis data revealed similar results, which indicated that Ether tokens could be leaving exchanges this week at an average rate of around 120,000 units per daily, a bullish signal. Excerpts:

“Assets on exchanges rise if more market participants wish to sell than to purchase and if buyers decide to store their assets at exchanges.”

IntoTheBlock offered a similar outlook, citing a fractal in October 2021 that saw Ether’s value rise by 15% ten day after massive ETH withdrawals were detected from centralized crypto exchanges.

Ethereum supply crunch underway

According to IntoTheBlock, the increase in Ether withdrawals from Exchanges this Week coincided with approximately 190,000 Ethereum moving into Lido’s “stETH liquid stakin” pools.

Lido, a noncustodial staking platform, allows users to overcome the challenges of staking on Ethereum 2.0 Beacon Chain. This includes the requirement of staking a minimum 32 ETH or multiples. Lido also proposes to solve capital efficiency problems by issuing stETH. This tokenized version of staked ETH will be issued.

Over 1 million ETH was added by Ether holders to the Ethereum 2.0 contract in the last 30 days. As the protocol moves to PoS in summer, in the wake earlier this week’s “Merge”, the likelihood of Ether tokens being out of active supply has increased.

Lol. Lol. Between the Merge (Juneish), and Shanghai (Decemberish), no newly minted Ether will be in circulation. I would text them, but I don’t even know their number. You got it? Poor anon.
— superphiz.eth March 16, 2022 (@superphiz).

Continued price rebound for Ethereum

Ether has entered a rebound mode due to the bullishness surrounding Ethereum’s switch to proof of stake.

Related: Vitalik Buterin discusses crypto’s perils in a Time Magazine interview

ETH’s price rose by over 17% to almost $3,000. The upside retracement occurred at a technical level. This is rising trendline support that has a history of limiting Ether’s bearish outlooks.

Daily price chart for ETH/USD Source: TradingView

Cointelegraph reported that Ether may lose some of its gains due to another technical level. This time, it is a falling trendline resistance. It has been instrumental in limiting its upside attempts since January 2022.

These trendlines seem to have created a continuation pattern known as a symmetrical triangular triangle. This indicates that Ether will likely move in the opposite direction to its previous trend, which is down. ETH may pullback from its resistance line and fall toward the triangle’s support trendline.

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