The amount of Ethereum held on major cryptocurrency trading platforms has dropped to its lowest level since November 2018, which, according to cryptocurrency analyst Santiment, lowers the “risk of a future major sell-off.”
Cryptocurrency users often withdraw funds from cryptocurrency exchanges if they plan not to use them on the blockchain or to store them in a cold wallet for long-term storage with HODL. When funds go public, a sell-off is often expected, while market outflows suggest investors want to keep their coins longer.
In the case of Ethereum, more investors could withdraw their funds from the exchanges to take advantage of decentralized financial applications (DeFi) in the network’s ecosystem. This includes loan applications, decentralized exchanges, derivatives trading and others.
Ethereum is trading slightly above $ 2,000 at press time after falling from an all-time high of over $ 4,000. The amount of ether on the trading platform could mean that the cryptocurrency is holding over $ 2,000.
As reported by CryptoGlobe, data from Santiment has also shown that Ethereum whales – wallets, or clusters of wallets in excess of 10,000 ETH – did not move during the recent market sell-off, in which the value of ETH was down over 25% from its all-time value have high.
Over $ 34.3 million worth of the second largest cryptocurrency by market cap, Ethereum whales barely touched their funds during the sell-off, with only 8 addresses getting out of the category. Funds withdrawn from exchanges can mean more whales are piling up.
On the flip side, Ethereum addresses holding between 100 and 10,000 ETH apparently sold some of their holdings during the downturn, with the number of addresses in that category eventually falling to a three-year low.
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