After hitting its latest all-time high of $4,956 on August 23 on Binance, Ethereum (ETH) has been trading in a tight range \u2013 oscillating between $4,200 to $4,500 \u2013 giving little clues about its next potential direction. However, recent exchange data suggest that a supply crunch may be nearing for ETH.<\/p>\n
According to a CryptoQuant Quicktake post by contributor Arab Chain, during the period between August 16 to September 3, Ethereum\u2019s Binance Exchange Supply Ratio (ESR) saw a sharp decline<\/a>.<\/p>\n Although ETH\u2019s price has remained in the mid $4,000 range, its ESR tumbled from 0.041 to\u00a0 0.037 \u2013 marking the biggest decline within the observed period \u2013 in a matter of just two weeks.<\/p>\n It\u2019s worth highlighting that ETH\u2019s price has remained stable all this time, trading close to $4,400 at the end of the period. According to the CryptoQuant analyst, such price behavior can explain two things.<\/p>\n First, it signals that investors are withdrawing from exchanges \u2013 including Binance \u2013 at an accelerated pace. Further, it also shows growing confidence among ETH holders as they opt for self-custody in cold wallets instead of keeping their holdings on exchanges.<\/p>\n Arab Chain remarked that a combination of stable price, declining exchange supply, and healthy exchange-traded fund (ETF) inflows confirms that sellable supply is dwindling while the demand for the digital asset remains strong. They added:<\/p>\n Declines in ESR have historically preceded strong upward moves, as lower exchange liquidity limits sellers\u2019 ability to push prices down. The current ESR levels have fallen back to pre-June figures, suggesting that the market has effectively \u201cflushed out\u201d previous profit-taking activity and is now reaccumulating supply into long-term wallets.<\/p>\n The analyst concluded by saying that if ETH\u2019s ESR continues to fall without a corresponding decline in price, then it would mean that the market is entering a new, institutional investor-led bull cycle. Three metrics in particular support this prediction.<\/p>\n The ETH market has seen a recent drop in leverage, meaning there are fewer traders with speculative positioning. Further, most perpetual futures markets show neutral funding rates for ETH contracts. Finally, the on-chain activity by ETH whales has also subsided, meaning long-term holders are not selling.<\/p>\n Also worth noting is that the Ethereum blockchain\u2019s fundamentals continue to improve. Latest data shows<\/a> that as much as 36 million ETH has been staked on the ETH network, further raising the possibility of an ensuing supply shock.<\/p>\n Recently, Ethereum daily transactions also hit<\/a> a 12-month high. Amid these bullish developments, seasoned industry experts are not shying away from giving<\/a> ambitious ETH price predictions. At press time, ETH trades at $4,295, down 1.7% in the past 24 hours.<\/p>","protected":false},"excerpt":{"rendered":" After hitting its latest all-time high of $4,956 on August 23 on Binance, Ethereum (ETH) has been trading in a tight range \u2013 oscillating between $4,200 to $4,500 \u2013 giving little clues about its next potential direction. However, recent exchange data suggest that a supply crunch may be nearing for ETH. Ethereum Price Stable Amid […]<\/p>\n","protected":false},"author":0,"featured_media":94280,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-94279","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-discovery"],"_links":{"self":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/94279"}],"collection":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"replies":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=94279"}],"version-history":[{"count":0,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/posts\/94279\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=\/wp\/v2\/media\/94280"}],"wp:attachment":[{"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=94279"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=94279"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/mycryptomania.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=94279"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}ETH Entering A New Bull Cycle?<\/h2>\n