ETH holdings of whale addresses on exchanges have continued to plummet; meanwhile, the supply held by non-exchange wallets are reaching a new all-time high.
Data released by on-chain metric aggregator Santiment shows that investor sentiment towards the second-largest digital asset by market cap appears to maintain a bullish outlook. The total amount recorded in the top ten non-exchange wallet addresses peaked at 26.22 million ETH.
Meanwhile, those on exchanges plummeted to 3.52 million ETH on Jan. 23rd. This divergence continued to widen after a momentary contraction towards the last days of 2021, as shown on the chart below. Before last December, these metrics maintained a close balance, fluctuating around 18 million ETH.
Source: Santiment
Deeper dive into what On-chain data buttress
A closer look at the statistics reveals an inverse correlation between the ETH supply held by the top exchange whales and non-exchange whale addresses. While the latter has grown to a new ATH, the former has plummeted to its lowest value in the last five years.
In January 2021, when ETH was priced at $1290, the ratio of top non-exchange whale addresses to top exchange whale addresses was 0.364. The total supply held by the both of them were 12.96 and 9.46 million, respectively.
Furthermore, ETH holdings on non-exchange whale addresses grew by over 100% to its new ATH over the past year. The number of tokens held by the top exchange whale addresses represents more than a 60% drop from previous highs. As a result of this, the ratio now stands at 3.68.
Without a doubt, the data paints a bullish picture for Ethereum amidst the current sell-off in the crypto market. This is because it points out the likelihood of an unwavering disposition to stack more of this asset in cold storage and sell less. Statistics from on-chain analytic platform Data from Cryptoquant supports this outlook as it shows a reduction in the number of ETH held across all exchanges. They reveal that this supply has decline steadily from the last quarter of 20201 through till date.
Source: CryptoQuant
Ethereum’s Price At Critical Threshold
Crypto analyst Ali Martinez believes that Ethereum needs to overcome the resistance at $2500 for a rebound in price. He opined that this threshold was mainly significant as 360,000 addresses held 9.6million ETH when the price fell to $2200.
Ether has rallied in value following the sell-off. It is currently trading at around $2500, an area with significant support. Like Martinez has predicted, it would need significant buy orders to see momentum upwards towards $2700 and possibly $3000.
Ethereum daily chart
Source: TradingView
Conversley, if it cannot rally and break the resistance at $2700, a retest of the current support would happen. Prices may plunge lower towards the next substantial support around $1800 if the $2500 support fails to hold. A look at the relative strength index (RSI) over the last 14 days shows that Ether is currently oversold.
Kingsley is a fintech writer with over 4 years of experience covering blockchain and cryptocurrency news. Alo first discovered Bitcoin in 2016 and has been passionate about it ever since, particularly the various ways blockchain can help Africa and the world at large. He desires to give the crypto space a more geographically balanced narrative and serve as a bridge between Africa and the rest of the world. His articles have been featured in Cointelegraph, Beincrypto, and Forkast.news, among others.
