More than $1 billion worth of Ether (ETH) has been removed from centralized exchanges in the past 24 hours, leading to speculation about imminent price gains for Ether as supply shrinks on many trading venues.
According to data shared by crypto analytics provider IntoTheBlock, $1.2 billion worth of ETH was withdrawn from centralized exchanges on Thursday to mark a new record in short-term outflows from exchanges.
IntoTheBlock noted that Ether’s price rallied by 60% in the 30 days after $1 billion was pulled from centralized trading platforms in April.
The net amount of $ETH leaving exchanges just hit a new record
— IntoTheBlock (@intotheblock) September 16, 2021
Over $1.2B worth of $ETH left centralized exchanges yesterday
Last time $1B+ left CEXs, #Ethereum increased by 60% within 30 days pic.twitter.com/wfRuX11Rtk
The situation has changed since April, however. Last month’s London upgrade introduced a burn mechanism into Ethereum’s fee market, creating increased deflationary pressure on Ether’s supply dynamics.
At the time of writing, 309,505 Ether, worth more than $1.1 billion, has been burned in the 42 days since Ethereum Improvement Proposal 1559 went live, according to Ultrasound Money. As such, Ether has been removed from supply at a rate of roughly 5.05 ETH ($18,061) every minute or $26 million daily since the upgrade.
#ethereum supply on exchanges just keeps dropping, and the price just keeps rising. $10,000 is programmed in already. pic.twitter.com/jRTUYHK4Ca
— Lark Davis (@TheCryptoLark) September 17, 2021
Booming nonfungible token marketplace OpenSea is Ethereum’s leading decentralized application by burn rate representing more than 14% of all ETH that has been removed from the supply, followed by Uniswap v2 with 5.5%, Tether with 4.9%, and Axie Infinity with 3%. Ether transfers have also driven 8.7% of burned Ethereum.
Related: Ethereum options data suggests the battle for $4K ETH is at least a week away
Bitcoin (BTC) has also seen steady outflows from centralized trading venues since peaking at 17% of supply in May.
According to on-chain analytics firm Glassnode, centralized exchanges’ BTC reserves have fallen to their lowest level since February 2018.
#Bitcoin exchange balances have returned to 13.1% of circulating $BTC supply, winding back the clock on inflows to Feb 2018.
— Yann & Jan (@Negentropic_) September 14, 2021
The all-time peak exchange balance was 17%, hit on the exact bottom of the March 2020 sell-off.
The trend changed that day. pic.twitter.com/CooGIBmaCh