TLDR
Ethereum’s supply on exchanges has fallen to the lowest level since November 2015 (8.97 million ETH)
ETH price is down 26-47% in the past month, currently trading around $1,970-$1,990
Reduced exchange supply typically signals long-term holder accumulation and potential “supply shock”
Ethereum faces challenges including decreased mainnet activity, lower fee revenue, and competition from Layer-2 networks
Spot Ethereum ETFs have seen 12 straight days of outflows totaling $370.6 million
Ethereum’s supply on crypto exchanges has fallen to its lowest level since November 2015, with just 8.97 million ETH now available on trading platforms. This represents a decrease of 16.4% in just the past seven weeks.
The sharp decline suggests ETH holders are moving their assets into cold storage wallets for long-term holding. Many crypto analysts view this as a bullish signal of growing conviction in Ethereum’s future price appreciation.
Crypto analytics platform Santiment reported the data on March 20. They noted that ETH has been rapidly leaving exchanges since the end of January.
👋 Thanks to the many DeFi and staking options, Ethereum’s holders have now brought the available supply on exchanges down to 8.97M, the lowest amount in nearly 10 years (November, 2015). There is 16.4% less $ETH on exchanges compared to just 7 weeks ago. 😮 pic.twitter.com/r5957wPhLi
— Santiment (@santimentfeed) March 20, 2025
This pattern often precedes what traders call a “supply shock.” When fewer tokens are available for immediate trading on exchanges, even modest increases in demand can drive prices higher.
We’ve seen similar patterns with Bitcoin in the past. In January, Bitcoin’s exchange reserves hit a seven-year low just before BTC surged to new all-time highs.
Despite these positive supply dynamics, Ethereum’s price performance has been weak. The token is currently trading at around $1,990, down 26-47% from its recent peaks.
ETH reached around $4,000 on multiple occasions during the late 2024 and early 2025 bull run. Unlike Bitcoin and many other cryptocurrencies, Ethereum failed to set a new all-time high above its previous record of $4,878 from November 2021.
The token experienced a steep decline, bottoming at $1,750 just last week. This represents a 55% drop from its local peak during this market cycle.
ETH’s Conflicting Signals
Several crypto traders remain optimistic despite these challenges. Trader Crypto General told his 230,800 X followers that it’s “just a question of time before the big supply shock.”
Another commentator named Ted suggested that with ETH supply on exchanges decreasing daily, “buyers will soon compete, leading to bidding wars.”
Exchange reserve $ETH is decreasing with the day.
With limited supply, buyers will soon compete, leading to bidding wars.
It’s only a matter of time. pic.twitter.com/uKVkknAAOC
— Ted (@TedPillows) March 19, 2025
Crypto trader Naber has made an even bolder prediction. They believe the largest ETH accumulation is taking place now, potentially leading to an $8,000-$10,000 price range in the future.
Not all indicators are positive, however. Ethereum’s performance against Bitcoin has been at its lowest point in five years, according to trader Daan Crypto Trades.
Ethereum spot ETFs have experienced 12 straight days of outflows. These outflows have totaled $370.6 million according to Farside data.
The decreased activity on Ethereum’s mainnet is another concern. Monthly decentralized exchange (DEX) volume on Ethereum has fallen from $92 billion in December to $82 billion in February.
Layer-2 networks like Arbitrum and Base are gaining traction due to their lower fees. These networks processed $5.67 billion of the past week’s $9.8 billion in Ethereum-based DEX protocols.
This shift has hurt Ethereum’s fee revenue, which dropped from $218 million in December to just $46 million in February. The recent Dencun upgrade reduced gas fees by 95%, making transactions less costly but further impacting revenue.
From a technical perspective, Ethereum faces resistance at $2,042, with the 50-day moving average acting as a barrier. If ETH breaks above this level, the next targets would be $2,163 and $2,370.
On the downside, a failure to hold $1,986 could see ETH decline toward $1,714, where previous buying interest emerged. The RSI indicator at 41.22 shows ETH recovering from oversold conditions but lacking strong momentum.
Standard Chartered analysts recently lowered their year-end ETH price target from $10,000 to $4,000. They cited increased competition from other networks, especially Ethereum layer-2s, as a main factor for this revision.
A potential catalyst for Ethereum could come from staking exchange-traded funds. Both the New York Stock Exchange and Chicago Board Options Exchange have submitted requests to the SEC to permit staking in Ethereum ETFs.
