Ethereum (ETH) Supply on Exchanges Hits All-Time Low—A Bullish Signal?

The Ethereum (ETH) supply on centralized exchanges has reached its lowest level in history, according to new on-chain data from Santiment.

The supply of Ethereum (ETH) on centralized exchanges has hit an all-time low, as per on-chain data from Santiment.

This milestone highlights the broader trend of decreasing exchange balances for ETH, which may carry significant implications for market sentiment and price action.

As of Wednesday, August 2, the ratio of ETH held on exchanges has reached its lowest point ever, continuing a pattern that has been steadily unfolding.

According to the chart shared by Santiment, the ETH exchange supply has declined sharply and consistently over the past year, in particular.

As investor confidence in Ethereum’s long-term prospects grows—driven by staking, Layer 2 development, and increasing institutional interest—this data could be a point of interest.

This trend is often interpreted as bullish—fewer coins on exchanges generally means less selling pressure. When holders move assets off exchanges, it’s often a signal that they intend to hold them long-term, rather than sell or trade.

This pattern is also unfolding for Bitcoin (BTC), albeit at a more moderate pace, with its exchange supply now at its lowest since November 2018.

In other news, Bernstein analysts have predicted that corporations will allocate $330 billion to Bitcoin in the next five years. This is more than triple the current total, which stands at around $90 billion.

The analysts believe that institutions will increasingly turn to Bitcoin as a hedge against inflation and market volatility. They also noted that several large corporations, including BlackRock and MicroStrategy, have already made significant investments in Bitcoin in recent years.

Bernstein’s prediction is based on an analysis of corporate balance sheets, investment trends, and macroeconomic factors. The analysts believe that several factors will drive institutions to allocate more funds to Bitcoin in the coming years.

One factor is the low interest rate environment, which makes it less attractive for institutions to hold cash. Another factor is the increasing volatility in the equity markets, which could lead institutions to diversify their portfolios with alternative assets, such as Bitcoin.

Bernstein’s prediction is a bold one, but it is not entirely out of the realm of possibility. If institutions do begin to allocate a larger percentage of their assets to Bitcoin, it could have a significant impact on the cryptocurrency market.

It remains to be seen whether Bernstein’s prediction will come to pass. However, the analysts' analysis provides valuable insights into the evolving investment strategies of institutions.