Analyst: ETH holdings on CEX platforms drop to a historic low of 8.8%, supply shortage may drive prices up

According to ChainCatcher, citing a report by Cointelegraph, analyst Milk Road stated that the amount of ETH stored on centralized cryptocurrency exchanges has dropped to unprecedented lows, which could lead to a supply squeeze. According to Glassnode data, the amount of ETH held on exchanges is at a low of 8.8%, essentially the lowest level since the network launched in mid-2015.

Since early July, the amount of ETH on exchanges has decreased by 43%, coinciding with the acceleration of Digital Asset Treasury (DAT) purchases. In contrast, the amount of bitcoin held on exchanges remains higher, at 14.7%. Milk Road believes that ETH is continuously being moved into areas that are difficult to sell, such as staking, restaking, layer 2 network activities, DAT, collateral cycles, and long-term custody, indicating that a tightening supply may drive prices higher.

"Currently, market sentiment is subdued, but sentiment does not determine supply. The supply of ETH is quietly tightening, and the market is deciding the next move. When this gap disappears, prices will rise accordingly."