None of this happened in a liquid market.
Ethereum’s exchange-held supply has fallen back to levels last seen in mid-2016. According to CryptoQuant data, total ETH reserves across all exchanges are at roughly 16 million ETH. This matches the same spot supply seen during Ethereum’s first full year of trading.
At the time, ETH was barely established. Today, it is a multi-trillion-dollar ecosystem.
Source: Cryptoquant
The contrast with Bitcoin [BTC] is interesting. While BTC exchange balances have rebounded to around 2019 levels, Ethereum moved in the opposite direction. OTC balances have risen somewhat, but they’re still small in comparison to exchange supply.
If exchange liquidity continues to thin (while large players unwind), price discovery could become unstable.
Even so, not everyone is stepping away. Despite it all, Tom Lee-backed Bitmine added 20,000 ETH worth $41.98 million on the 8th of February. Separately, the Infini exploiter also bought the dip, spending 13.32 million DAI to acquire 6,316 ETH at $2,109. This was before routing funds through Tornado Cash.
ETH weakness during low liquidity
Ethereum traded at $2,077 at press time. The token was down from recent highs near $3,300, a fall of roughly 37%. The daily RSI was at 31.22.
Trend strength was still elevated, with the ADX at 50.01. Bearish pressure dominated as –DI (35.77) stayed well above +DI (6.78).
Source: TradingView
Selling volume has expanded during the decline, with daily volume near 39.7K ETH.
Final Thoughts
- Ethereum falls with exchange balances at 16 million ETH.
- Even modest flows could move price aggressively.
