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The asset had dropped below the $2,700 price range for the first time in a two-month period. And the September slowdown has caused recovery trends to fall short of expectations. Despite this, crypto analyst Lark Davis does not believe the asset should be counted out just here. Pointing to some interesting exchange reserve metrics, the analyst believes that Ethereum could very well be on the verge of an explosion.Exchange Reserves Drop 15%
Declining exchange reserves volume has been reported upon recently. This is not peculiar to Ethereum alone. . This goes against the grain of how bull markets have operated in the past. With each past rally have come increased exchange reserves as investors moved their assets onto centralized exchanges to sell and take profits. But 2021 has been the year of the unexpected in the crypto market.ETH price trading below $3,000 | Source:Instead of exchange reserves going up as the price went up, it has gone the opposite direction. At the height of the bull rally this year, there had been 21 million ETH on centralized exchanges. But even as the market has dipped and recovered at various points, exchange balances are going down. Now, there is about 18 million ETH on centralized exchanges, showing a 15% decline from the height of the bull market earlier in the year.
Why Exchange Reserves Are On The Decline
One reason for exchange reserves being on the decline is due to accumulation patterns by investors. Market sentiment has skewed more towards holding than selling despite the recent bull rally and as such, investors are buying more cryptocurrencies and moving these assets to more secure personal wallets. These accumulation patterns are driving what may be a .Related Reading | Over $5 Billion In Bitcoin And Ethereum Moved From Cold Wallets Amid China Crackdown
Chart from TradingView.com