Analyst: ETH Holdings on CEX Platforms Drop to a Historic Low of 8.8%, Supply Shortage May Drive Price Up

PANews, December 7—According to a Cointelegraph report, analyst Milk Road stated that the amount of ETH stored in centralized cryptocurrency exchanges has dropped to an unprecedented low, which could lead to a supply squeeze. According to Glassnode data, the amount of ETH held on exchanges is at a low of 8.8%, which is basically the lowest level since the network launched in mid-2015. Since early July, the amount of ETH on exchanges has decreased by 43%, coinciding with the accelerated growth in Digital Asset Treasury (DAT) purchases. By comparison, the amount of Bitcoin held on exchanges is higher, at 14.7%.

Milk Road believes that ETH is continuously being moved into areas where it is hard to sell, such as staking, restaking, layer 2 network activity, DAT, collateral loops, and long-term custody, suggesting that the tightening supply could drive prices higher. “Currently, market sentiment is gloomy, but sentiment does not determine supply. ETH’s supply is quietly tightening, and the market is deciding the next move. When this gap disappears, the price will rise accordingly.”