Analyst cites anticipation of spot Ethereum ETFs as a key factor.\n<\/p>\n
Investors have been rapidly pulling their ETH out of exchanges, signaling they expect Ethereum\u2019s native cryptocurrency to rally in the coming months.<\/p>\n
Investors have pulled over 4.1 million ETH, or $40.21 billion from exchanges in the last 10 days. This mass withdrawal, which amounts to roughly 3.3% of the total circulating supply, has driven ETH exchange balances to dip below 12 million ETH, the lowest level since March 2016, according to data <\/a>from Glassnode.<\/p>\n Ryan Lee, Chief Analyst at Bitget Research, points to the anticipation surrounding the Ethereum ETF as a critical factor.<\/p>\n “Both retail and institutional investors believe [the spot ETH ETF] approval will trigger massive demand for Ethereum,\u201d Lee said in an interview. \u201cThis explains the proactive accumulation of over 4.1 million Ethereum on trading platforms \u2014 a trend I don\u2019t expect to slow down until months after the S-1 registrations are approved.\u201d<\/p>\n On May 24, the U.S. Securities and Exchange Commission greenlit <\/a>the trading of eight exchange-traded funds backed by spot Ether, including the Grayscale Ethereum Trust, the Bitwise Ethereum ETF, and BlackRock’s iShares Ethereum Trust. After approving the issuers 19b-4 forms, the agency still has to approve their S-1 forms for the products to start trading.<\/p>\n On June 13, SEC Chair Gary Gensler testified <\/a>that the approval of an Ethereum spot ETF could come as early as this summer.<\/p>\n ETH balances on exchanges have plunged to below 12 million from their peak of 33 million in 2020, Glassnode data shows.<\/p>\n On Binance alone<\/a>, the ETH balance in May peaked at 4 million but dropped to 3.8 million within two weeks, with over 200,000 ETH taken off the platform. Meanwhile, more than 300,000 ETH left Coinbase since May. This is only the fifth time more than 150,000 ETH has been withdrawn from the exchange.<\/p>\n \u201cThese large transactions (made in a single day) range between $400 million and $1.1 billion each,\u201d said CryptoQuant analyst Burak Kesmeci. \u201cIt\u2019s highly likely that these Ethereum withdrawals are driven by whales.\u201d<\/p>\n Meanwhile, Lee suggests that this movement of ETH away from exchanges might indicate a strategy to hold on to their assets.<\/p>\n \u201cLarge holders are also buying ETH through spot trading on exchanges and then transferring them to on-chain wallets, awaiting further price increases,\u201d he explained.<\/p>\n In contrast to Ethereum, Bitcoin’s supply <\/a>on exchanges has risen to 3 million BTC from 2.67 million BTC in May.<\/p>\n On-chain data reveals <\/a>a decline in the number of new active addresses for both Bitcoin and Ethereum. Ethereum\u2019s new active addresses dropped by 10% in May to 467,720 addresses while Bitcoin saw a decline of 27%, bringing the total down to 252,470.<\/p>\nThe Steep Decline in Exchange Balances<\/strong><\/h3>\n
Ethereum vs Bitcoin Supply<\/strong><\/h3>\n