Cryptocurrency analytics company CryptoQuant pointed to a significant supply contraction in its latest assessment of the Ethereum market. According to the company’s data, Ethereum’s liquid supply has fallen to its lowest level since 2024.
CryptoQuant’s analysis, based particularly on Binance data, indicates a significant decrease in the amount of $ETH available for immediate trading in the market. It argues that this could ease selling pressure in the short term and have a supportive effect on prices.
According to the data, total Ethereum reserves on Binance remain relatively balanced at approximately 3.44 million $ETH, while the liquid supply has dropped to around 534,000 $ETH. In contrast, the illiquid supply stands at approximately 2.91 million $ETH. This indicates that a significant portion of the assets in circulation are held for the long term.
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Another key point highlighted in the analysis was the process known as “liquidity dryup.” During this period, investors withdraw their assets from exchanges and store them in cold wallets or for long-term investments, reducing the active supply in the market. Historically, such periods have been noted as precursors to strong price movements fueled by increased demand.
CryptoQuant interpreted Ethereum’s liquid supply falling to its lowest level since 2024 as a sign of increased investor confidence and a strengthening tendency towards accumulation rather than selling. The company stated that if this trend continues and demand improves, a more supportive market structure for Ethereum’s price could emerge in the short term.
*This is not investment advice.
