ETH is gaining pace on Binance, this time with increased spot inflows. The token saw the highest net inflows to the centralized exchange since 2023.
ETH is returning to Binance, as whale deposits are boosting the balances. The increased exchange flows may signal an increased interest in trading, taking up positions on the derivative market, or holding reserves for future sales.
ETH exchange inflows spiked to the highest level since the spring of 2023, potentially signaling a market shift. Reserves on exchanges remain near their all-time lows. | Source: Cryptoquant
Binance saw the biggest inflow of ETH since April 2023, a significant spike after days of mostly balanced flows.
Exchange netflows are a short-term metric of sentiment, which may quickly shift. However, big movements may signal a market turning point. As of December 5, Binance saw a spike in inflows, moving 162,084 ETH, at a moment when ETH hovered just above $3,000.
Big exchange inflows may signal ETH market shift
Often, big exchange inflows signal a bearish turn for ETH. However, ETH sentiment based on the fear and greed index remains neutral. Binance is typically a preferred destination because it remains the most liquid exchange, also inviting riskier positions with higher leverage.
The exchange inflow has the ability to sway the market, as it rivals most of the whale buying for a single day. It remains uncertain if all deposits are used for selling or for other tasks like staking with Binance’s liquid staking facility.
Despite this, analysts are also monitoring Binance’s order book depth to gauge if a sell-off would trigger another ETH price drop.
Overall, the ETH exchange reserves are still near an all-time low. Binance reserves bounced a bit in the past month, up to 3.88M ETH. The exchange flows may be part of strategic whale turnover, as ETH mostly relies on internal trading. Whales are constantly repositioning to achieve a lower average ETH price.
ETH open interest inches higher
ETH open interest is inching higher, back to $17.62B with over 70% of traders going long. ETH is still shorted a bit more aggressively on Hyperliquid, with 41% in short positions.
On Binance, ETH has accumulated the bulk of open positions just above $3,000, while short positions up to $3,200 have the biggest share of liquidity.
ETH bulls still prepare for a breakout, as the network remains a key component of decentralized finance. In the past year, ETH increased its value locked by around 14%, still remaining ahead of all other networks. Ethereum remains the most liquid source of lending, in addition to offering high-capacity liquid staking to holders.
For that reason, ETH is seldom sold in a panic, as whales hold onto the token for its utility and potential for passive income. ETH also remains close to 0.034 BTC, recently adding hopes of a further recovery to a higher range.
