Recent data show that the bitcoin (btc) supply and ethereum (eth) on exchanges has fallen significantly. This means that largest crypto tokens by market cap could be well poised for significant moves higher, with a supply squeeze imminent.
bitcoin and ethereum supply falls to new lows
btc ECHO analyst Leon Waidmann shared data from Glassnode, which showed that exchange balances for bitcoin and ethereum are at their lowest level in years. The supply of bitcoin on exchanges has fallen to 11.6%, while the supply of ethereum has fallen to 10.6%. This suggests that bitcoin-shark-whale-investors-go-to-the-market-heres-how-much-btc-they-bought/” rel=”nofollow”>crypto whales They have been accumulating these crypto tokens and transferring them into self-custody.
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Waidmann highlighted the importance of this fact and noted that a supply squeeze was imminent. This reduction in supply could help push up bitcoin and ethereum prices from most investors They appear to be accumulating at the moment rather than unloading their holdings. Along these lines, the analyst urged his followers to “prepare for the next big step.”
Curiously, crypto analyst Ali Martínez suggested that this movement might have started after the ethereum-spot-etfs-trading/#:~:text=Bloomberg%20analyst%20James%20Seyffart%20has,approval%20would%20come%20this%20week.” rel=”nofollow”>approval of Spot ethereum ETFs. Said in an x (formerly twitter) x.com/ali_charts/status/1797231021147947412″ rel=”nofollow”>mail that nearly 777,000 eth ($3 billion) have been withdrawn from crypto exchanges since the Securities and Exchange Commission (SEC) approved these funds.
Once finally launched, these ethereum Spot ETFs are expected to drive the lockdown at full speed. As such, it is not surprising that these crypto whales are looking to position themselves ahead of this development. ethereum-spot-etf-experts-weigh-in-on-selling-point/” rel=”nofollow”>Eric Balchunas, Bloomberg analyst predicted that these funds will likely begin trading in July.
However, research firm Kaiko has warned that these funds may not instantly send the price of ethereum to new all-time highs (ATH). The second-largest crypto token will likely face significant selling pressure thanks to potential exits from Grayscale's Spot ethereum ETF. This is based on the $6.5 billion outflows that bitcoin-etf-outflows-equilibrium-grayscale” rel=”nofollow”>Grayscale bitcoin Spot ETF recorded in its first month of trading, causing a significant drop in the price of bitcoin.
eth could reach a new all-time high in record time
Cryptoanalyst Michael Nadeau suggested that ethereum could still hit a new ATH once ethereum Spot ETFs start trading faster than bitcoin after the launch of the bitcoin-spot-etfs-breach-1-million-btc-threshold/” rel=”nofollow”>bitcoin Spot ETF. He noted that ethereum does not have the same amount of “structure selling” that bitcoin encounters, as eth validators do not have to sell their holdings to compensate. bitcoin-mining-costs-post-halving/” rel=”nofollow”>operating costsunlike bitcoin miners.
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He also highlighted that 38% of ethereum's supply is locked on-chain and stated that “eth is more reflective than btc.” He further explained that this reflexivity is evident in how ethereum leads on-chain activity, leading to more eth-is-expected-to-be-burned-every-year/” rel=”nofollow”>eth burned. With this in mind, Grayscale's outflows may not impact the price of ethereum like they did the price of bitcoin, which could cause the second-largest crypto token to hit a new ATH before long.
