The amount of Ether (ETH) held by all cryptocurrency exchanges has declined dramatically in the previous 12 months.
Blockchain analytics firm CryptoQuant reported that Ethereum reserves on trading platforms dropped 26.29 million ETH to 19.22 million ETH year-on-year (YoY), indicating that traders’ preference to hold their tokens increased.
At least the Ether price performance in the same period indicates the same. Between August 25, 2020, and press time, the ETH/USD exchange rate exploded by a little over 730%— from $407 to $3,190, signaling an erratic inverse correlation between the Ethereum token prices and its reserves across all exchanges.
In detail, traders typically prefer to keep their crypto assets on exchange wallets when they wish to trade them in the near term. Otherwise, they move those assets to private wallets to control their own keys, a strategy that stems from the fears of losing funds to hacks and similar security breaches at crypto exchanges.
Ether deposits plunge
Another on-chain indicator, built by CoinMetrics to track the total number of Ether deposits to exchanges, also alerted holding sentiment among Ethereum traders. It noted that traders’ ETH deposits across all the trading platforms had plunged 21.11% YoY, from 413,772 ETH to 326,408.
But in the last 30 days, the ETH deposits have dropped dramatically by 47.81%, signaling that many investors are expecting higher prices in the long term.
Meanwhile, the sum count of unique addresses holding