Ethereum Exchange Reserves Drop To Record Low As Analysts Predict A Supply Squeeze

The amount of Ethereum (ETH) held on cryptocurrency exchanges has dropped to the lowest level in years after the approval of spot ETH ETFs (exchange-traded funds) on May 23, indicating an incoming supply squeeze.

Data from CryptoQuant shows that on June 2 the amount of ETH held on exchanges was worth around $49 billion, down from $52 billion on May 23.

Dropping Ethereum Supply May Trigger An ETH Price Rise

According to crypto market analyst Leon Waidmann, Ether supply on exchanges has dropped to 10.6%.

”Get ready for the next move,” said Waidmann on X.

📉 Exchange balances for both #Bitcoin and #Ethereum are at their lowest levels in years!🔥

Whales continue to accumulate. #BTC on exchanges is down to 11.6% and #ETH is at 10.6%!

Supply squeeze incoming. 📈

Get ready for the next big move. 🚀 pic.twitter.com/u4j13DZBJk

— Leon Waidmann | On-Chain Insights🔍 (@LeonWaidmann) June 2, 2024

Waidmann’s bullish thesis was supported by DeFi Report analyst Michael Nadeau, who predicts ETH will rally to above $4,800 from $3,824 as of 4:59 a.m. EST.

In his analysis, Nadeau said that the launch of spot Ethereum ETFs will drive the price gains.

Analysts predict that ETH ETFs might start trading as early as late June, albeit with lower volumes than attracted by spot Bitcoin ETFs.

But Nadeau said Ether ETFs will have a more positive effect on the price of ETH compared to Bitcoin ETFs on Bitcoin. ETH lacks the “structural sell pressure” that Bitcoin has when miners are forced to sell coins mined to cater for expenses, he said.

Ether also offers a bigger incentive to hold due to the ability to earn yield on staking contracts and decentralized finance (DeFi) applications, he added. As such, Nadeau believes ETH will see high demand once ETFs start trading.

Also Read:

• GameStop Price Surges 238% As Roaring Kitty Reveals $180M GME Position And Traders Turn To This New Meme Coin For 100X Gains
• Pepe Price Prediction: PEPE Plummets 11% In A Week As Investors Rush To Buy This DOGE 2.0 ICO With Less Than 2 Hours Left
• 5 Best Crypto Presales With Potential to 10X Your Investments – Next Cryptos to Explode

Most Searched Crypto Launch - Pepe Unchained

Rating

• Layer 2 Meme Coin Ecosystem
• Featured in Cointelegraph
• SolidProof & Coinsult Audited
• Staking Rewards - pepeunchained.com
• $10+ Million Raised at ICO - Ends Soon

Learn More