Ethereum Exchange Outflows Hit 4-Year Low, As Ether Price Rises According to DailyCoin

Ethereum exchange outflows hit 4-year low as Ether price surges

Overall, 2021 can be considered a good year, having increased in value by more than 450% year-to-date. Regardless of Ethereum’s strong performance this year, Ether exchange outflows have fallen to a 4-year low.

According to data from Glassnode, ETH exchange outflows are currently at their lowest level since January 2018. Exchange cash flow shows the number of tokens that have been withdrawn from the exchange wallet in a given period of time.

Exchange cash flow has long been used as an indicator to identify trends in the cryptocurrency market. While investors see low exchange cash flows as a harbinger of a downtrend, Ethereum’s situation may be the exception many hoped for.

Exchange cash flow decreases as ETH price increases

The interesting thing about Ethereum’s declining outflow is that it correlates with Ethereum’s price rise.

On-chain data from CryptoQuant confirms that ETH exchange flows have steadily decreased throughout the year.

The graph shows the Ethereum derivatives exchange flow from January 1, 2021 to December 27, 2021 (Source: CryptoQuant)

Regarding the correlation, Ethereum holders who had been expecting a major rally after ATH in November could move their holdings off exchanges, potentially contributing a large part to the drop. .

The world’s largest cryptocurrency, is also experiencing a similar trend. According to on-chain data, the amount of BTC held on exchanges has dropped to 1.3 million, or 6.3% of Bitcoin’s total supply.

On Flipside

  • Since ETH outflows hit a 4-year low, the price of Ether has dropped 4% and is currently trading at $3,919 as of press time.

24-hour price chart for Ethereum (ETH). Source: Tradingview

Why should you care?

Many investors have decided to HODL instead of selling their coins amid anticipation of the explosive growth of the crypto industry in 2022.


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Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor is it accurate. All CFDs (stocks, indices, futures) and Forex prices are not provided by exchanges but by market makers, so prices may be inaccurate and subject to change. differs from the actual market price, which means that the price is indicative only and is not suitable for trading purposes. Therefore, Fusion Media does not accept any responsibility for any trading losses you may incur as a result of using this data.

Fusion Media or anyone associated with Fusion Media shall not bear any liability for loss or damage resulting from reliance on information including data, quotes, charts and buy/sell signals contained in this site. Please be fully informed of the risks and costs associated with trading in financial markets, which are among the riskiest forms of investment possible.

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