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Exchanges See 27% Drop In ETH Supply In Just 48 Hours

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Rise in Ethereum DeFi Tokens Leads to Increasing Crypto Lending Volumes
Rise in Ethereum DeFi Tokens Leads to Increasing Crypto Lending Volumes

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Within the past two days alone, Ether reserves on various crypto exchanges took a massive hit. The data from CryptoQuant shows that as little as 8.1 million ETH could be in reserve across the world’s centralized exchanges.

ETH Supplies Could Be Drained In The Next 48 Hours

Alex Saunders from Nuggets News was one of the first to notice the drop in Ether reserves, a 10% drop at the time, on the 14th of January. In just 24 hours, the total ETH reserve dropped from 11 million to just 10 million. At that pace, it was theorized that exchanges would run out of ETH reserves within just ten days.

However, the ETH reserves started to drop even more than that, going down by another 20% in just one day. From here, Saunders started to speculate that major exchanges could run out of ETH reserves in as little as 48 hours, which would put a massive squeeze on liquidity.

Some Positive Predictions

Something to make a note of, is that other data providers have also shown drops in ETH reserves across the exchanges. After clocking an all-time high back in middle May of 2020, these data providers report that the Ether balances have dropped by 42.5%.

Glassnode also has a thing to say about it, as its data shows that the only time Ether supplies were this low on crypt exchanges was back in July of 2017. As it stands now, only 7% of the entire circulating supply of Ether is being held on exchanges.

With this data in mind, Saunders is predicting a massive bull run for Ether, blasting past into new all-time highs. He didn’t even need to go far to justify this speculation, highlighting exactly what happened when the demand far outstripped the supply in the Bitcoin space: Its price went up by a factor of 4 in just 90 days.

ETH Far Outpacing BTC In Supply Loss

CryptoQuant made it clear that the BTC reserves on major exchanges saw a drop of 21% since its all-time high that was recorded back in March of 2020. Even so, Ether’s recent pace of reserve depletion is far higher than that of Bitcoin’s. As Bitcoin saw a 230% increase in price action, going to $40,000 from $12,000, the total reserve supply on exchange dropped by as little as 4.5%

It should be noted, that CryptoQuant didn’t recognize a recent transaction done, by the tune of 600,000 Ether, that was pegged as an internal Bitfinex cold wallet transfer. Another massive Ether amount, 2 million, has been moved to the Gnosis, a decentralized finance platform.

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