Ethereum has been exiting exchanges at a faster rate than Bitcoin, with only 8.84% currently held on exchanges, as the supply of ETH becomes increasingly tight. Data retrieved from Glassnode and CryptoQuant indicate that the amount of ETH still held in exchanges is nearly half that of BTC (14.8%).
Leon Waidmann, the head of research at the Onchain Foundation, stated that staking is one of the primary reasons why the ETH supply on exchanges is dwindling, as most of it is locked up in staking contracts. He also observed that DeFi is pulling ETH off exchanges, but long-term holders are not selling their ETH.
However, Lucca Rassele, the head of digital asset ventures at MPM Labs, believes that the ETH/BTC exchange balance comparison ignores the fact that they have different functions. On the other hand, Derek Little, the founder and CEO of Innovative App World LLC, agrees that the reason more ETH is leaving exchanges than BTC is its utility. Little claims that crypto hype cycles have died down, and it is now mainly about interoperability.
Ether holders move, sell, and spend more than BTC investors
November’s data retrieved from Glassnode reveals that ETH holders are moving, selling, and spending more than BTC investors. The on-chain crypto data aggregator emphasized that the reason behind ETH’s mass exchange exit is that its network powers crypto applications, which utilize ETH as gas fee.
Meanwhile, Glassnode says BTC holders tend to keep their coins in storage and treat them as digital gold. The blockchain data firm noted that BTC moves less frequently the ETH, behaving more like a digital savings asset. Over 61% of BTC’s circulating supply has been held dormant for more than one year.
By contrast, ETH rotates supply at nearly twice the rate of BTC because it functions as digital oil. ETH is also both stockpiled and actively used as collateral and a source of network fuel, reflecting a more active capital base.
According to Glassnode, ETH’s recent behavior is also reflective of its network’s inherent properties as a high-transaction platform for smart contracts. Long-term ETH holders are also mobilizing their old tokens at a rate almost three times that of Bitcoin’s long-term holders, pointing to ETH’s utility-driven behavior. The movement of ETH suggests that its long-term holders are more willing to part with their coins than BTC holders
Ether shows both utility and store of value behavior
Nearly 25% of ETH is locked in ETFs and native staking as the coin shows both utility and store of value behavior. Meanwhile, ETH turns over at twice the rate of BTC, reflecting the coin’s dual nature as both a hoarded and productive digital asset.
Ether also powers the DeFi ecosystem, with about 16% of ETH’s supply now deployed within liquid staking and collateralized structures. Glassnode also notes that this highlights ETH’s dual role as working collateral supporting DeFi and as a reserve asset.
As per Glassnode, ETH combines SoV-like anchoring through ETF holdings and native staking, with productive use across DeFi. A notable share of ETH participates in collateralized lending, liquidity pools, perpetuals, restaking, and LST/LRT structures.
Ether also continues to leave exchanges for institutional wrappers and long-term custody. Ethereum’s share on exchanges shows a steeper decline, with ETF adoption and DAT accumulation draining ETH’s balance on exchanges. ETFs now hold 5.24% of ETH’s supply, while DATs have accelerated this year to approximately 4.9% of ETH’s supply.
