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Ethereum’s supply is tightening as whale wallets accumulate over 1 million ETH in a single day, marking the largest daily buy since 2018 and signaling renewed institutional confidence.
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The Ethereum Foundation’s recent transfer of 9,000 ETH to a single address further reduces circulating supply, intensifying bullish market dynamics.
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According to COINOTAG, CME data reveals a record-high net short position on ETH, setting the stage for a potential short squeeze amid growing whale accumulation.
Ethereum whales accumulate over 1 million ETH, shrinking supply and sparking bullish momentum as CME shorts hit record highs, signaling a possible market reversal.
Whale Accumulation Drives Ethereum Supply to Historic Lows
In a significant market development, Ethereum whale wallets—those holding between 1,000 and 10,000 ETH—have increased their holdings by over 1 million ETH within 24 hours, marking the largest daily net inflow since 2018. This surge in accumulation has pushed total whale-held ETH above 14.3 million, substantially reducing available liquidity on major exchanges. The tightening supply is a critical factor contributing to Ethereum’s recent price rebound from support levels near $2,100 to testing resistance above $2,500. Market analysts are closely watching this trend, as sustained accumulation at these levels often precedes significant price appreciation.
Ethereum Foundation’s Strategic Transfers Amplify Market Impact
The Ethereum Foundation has played a notable role in this supply contraction by moving 9,000 ETH to a Gnosis Safe wallet within the last month. These transfers, executed in ten separate transactions of 1,000 ETH each, are indicative of strategic fund management, possibly linked to over-the-counter (OTC) deals or staking initiatives. Such movements effectively remove ETH from active circulation, further constraining market supply. This strategic reduction in float aligns with the broader trend of whale accumulation, reinforcing the bullish sentiment emerging across Ethereum markets.
Institutional Shorts Reach Record Levels Amid Rising On-Chain Strength
Contrasting the bullish on-chain activity, institutional traders on the Chicago Mercantile Exchange (CME) have amassed a record net short position exceeding 11,000 contracts on Ethereum. This divergence between growing whale accumulation and heavy short interest creates a precarious market environment. Should Ethereum’s price continue to rally, these short positions could trigger a substantial short squeeze, amplifying upward momentum. This dynamic underscores the importance of monitoring institutional sentiment alongside on-chain metrics to gauge potential market inflection points.
DeFi Revival and Stablecoin Growth Support Ethereum’s Bullish Outlook
Ethereum’s decentralized finance (DeFi) ecosystem is experiencing a resurgence, with total value locked (TVL) surpassing $120 billion—a level not seen since late 2021. This recovery signals renewed confidence among users and capital allocators in Ethereum-based protocols. Additionally, stablecoin supplies on the network are trending upward, indicating that idle capital is re-entering the ecosystem. The combination of increased DeFi activity and rising stablecoin liquidity suggests a robust foundation for sustained buying pressure, which, coupled with shrinking ETH supply, creates a favorable environment for price appreciation.
Conclusion
The recent historic accumulation of Ethereum by whale wallets, combined with strategic fund transfers by the Ethereum Foundation and a revival in DeFi activity, has significantly tightened ETH supply. Despite record-high institutional short positions, the prevailing on-chain strength and reduced market float position Ethereum for a potential bullish breakout. Investors should monitor these supply-demand dynamics closely, as they may herald a critical turning point in Ethereum’s market trajectory.
