Exchange Supply of Ethereum (ETH) Drops 47% in 2 Years

Global adoption, institutional inflows, and the DeFi boom played a vital role in the substantial price jump of Ethereum. However, one factor which did not receive much attention is ETH’s exchange supply ratio.

Over the last 2 years, ETH whales have shifted an enormous amount of Ethereum from digital trading platforms to cold crypto wallets. As a result, Ethereum’s exchange supply decreased by almost 47%. BTC also witnessed a substantial dip in its exchange supply.

“Bitcoin’s and Ethereum’s respective exchange supplies indicate that the previous 2 years have been the most sustained exodus of coins moving away from exchanges. There is 25% less of BTC's supply on exchanges compared to 2 years ago, and 47% less ETH supply,” Santiment noted.

Due to the shift from digital exchanges, the demand for crypto assets has spiked significantly in the last 2 years. ETH has jumped by more than 2,400% since December 2019. Ethereum 2.0, the much-awaited network upgrade of ETH, was launched in December 2020. According to Etherscan, the deposit contract of ETH 2.0 now has approximately 9 million coins with a total value of $34 billion.

Ethereum’s Institutional Inflows

In addition to price gains and wider adoption, institutional interest in ETH-related products have jumped in the last 24 months. Ethereum investment products saw inflows worth $1.4 billion in 2021, which is an increase of more than 50% compared to 2020. Global ETH assets under management reached $16.7 billion by the end of December 2021. ETH accounts for over 20% of global crypto assets under management.

“Ethereum saw inflows almost double from US$920 million in 2020 to US$1.3 billion in 2021 although in the most recent round of negative sentiment, ETH has seen 4 weeks of outflows totaling US$161 million,” CoinShares highlighted in its latest digital asset fund flows report.