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- There has been an increase in Ethereum
deposits on centralized exchanges. - Over 300,000 ETH has been transferred to exchanges.
An Ethereum whale has sent a large amount of ETH to Binance exchange. Should investors be concerned about exchange deposits?
Ethereum Exchange Deposits Increased Throughout the Day
According to data, this increase in supply on exchanges is the largest observed since the day before The Merge. “Exchange supply,” as the name suggests, is an indicator that measures the percentage of total Ethereum supply currently held in wallets of all centralized exchanges.
When this metric increases, it means investors are currently depositing some of their funds into exchanges. As one of the main reasons investors transfer their funds to exchanges is for selling purposes, such a trend can have downward consequences for the asset’s price.
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On the other hand, decreasing values of this indicator show that a net amount of ETH is currently being withdrawn from these platforms. Such withdrawal transactions could be a sign that owners are holding onto the cryptocurrency, which could naturally lead to a rise in the asset’s value in the long term.
Now, here’s a chart showing the trend in Ethereum supply on exchanges over the past few months:
Ethereum Supply on Exchanges
As shown in the above chart, Ethereum supply on exchanges saw a sharp increase yesterday, indicating that investors are depositing large amounts of ETH into these platforms.
The chart also has data for another ETH indicator: “exchange flow balance.” This metric measures the net amount of mined coins entering or leaving exchanges; thus, it primarily tracks changes in the supply indicator on exchanges.
Throughout yesterday, this metric saw a large positive value, indicating that inflows far outpaced outflows during this period. According to the metric, this increase brought approximately 320,000 ETH (worth $584.6 million at current prices) into exchange wallets.
This net increase in exchange supply is actually the largest observed for the cryptocurrency since September 14, 2022, the day before the proof-of-stake consensus mechanism was implemented.
$500 Million Transfer to Binance Exchange
Interestingly, as the data shows, only one transfer contributed to the majority of the increase in deposits.
This transfer to Binance exchange was worth approximately $505 million and was one of the largest transactions observed between an unknown wallet and an exchange in the past five years.
It is unclear whether the whale made this deposit for selling purposes or to use any of the other services offered by the platform. However, if the purpose is indeed selling, this large influx could be bad news for the asset’s price.
