There has been a noticeable shift in the Ethereum market recently, with significant outflows from centralized exchanges sparking discussions about the cryptocurrency’s short-term trajectory.
Amid this, Ethereum has seen a decline of 2.4% over the last 24 hours at the current trading price of $3,858, which is down 21.1% from the all-time high of $4,878 recorded in 2021.
Ethereum withdrawals from Binance exceed 7.8 million ETH
Data from CryptoQuant reveals that approximately 20.8 million ETH has been withdrawn from centralized exchanges over the past two months, reminiscent of the bull run of 2021. Binance played a key role in this movement, accounting for over 7.8 million ETH, representing 33 -39% of total outflows.
These outflows could indicate that investors are hoarding ETH for long-term holding or staking purposes, as suggested by CryptoQuant analyst Crazzyblockk. The analyst added:
These significant outflows from Binance demonstrate the platform’s continued influence on the cryptocurrency market, particularly in balancing supply and demand for Ethereum.
Notably, Binance’s influence is particularly noticeable given its global user base of 250 million and record deposits of $21.6 billion this year, according to Crazzyblockk.
Significant outflows from Binance coincide with bullish market sentiment, as large-scale withdrawals often signal investor confidence. These moves suggest that Ethereum holders are moving their assets away from exchanges.
This reduction in the available supply of ETH on exchanges could create upward pressure on prices if demand remains constant or increases.
Performance and prospects on the Etheruem market
Ethereum has so far struggled to gain significant price growth since the latest cryptocurrency bull market began a few months ago.
Even though Bitcoin has seen steady gains, posting modern record highs almost every month, Ethereum has not had enough upward momentum to push its price above the $4,000 barrier.
It’s worth noting that this sluggish Ethereum performance is due to positive developments in the cryptocurrency space, including recent news about Deutsche Bank, Germany’s largest lender apparently is working on its own Layer 2 (L2) blockchain on Ethereum using ZKsync technology.
JUST IN: Deutsche Bank Builds Own Layer 2 on Ethereum – Bloomberg pic.twitter.com/5O5K3R1fRg
– Radar
(@RadarHits) December 18, 2024
Regardless of such news, ETH saw a modest gain of 2.3% last week, down from Bitcoin’s 5% gain over the same period.
According to analysts, Ethereum can likely still see a further correction in its price as bearish signals have appeared on its chart recently, suggesting a potential drop to 3,400.
$ETH has formed a bearish double top, with the RSI showing a bearish divergence and the MACD crossover confirming the trend.
A short-term correction could take it to $3,400, with major support at $3,200 and $3,000. #Ethereum #CryptoTrading #eth pic.twitter.com/iWaPh1vwrr
— cryptocurrency trader
(@crypto_vulture1) December 18, 2024
Featured image created with DALL-E, chart from TradingView
