Sixteen cryptocurrency wallets accumulated 431,018 ETH tokens valued at $1.73 billion between Sept. 25 and Sept. 27, according to blockchain tracking data. The purchases occurred through major platforms including Kraken, Galaxy Digital, BitGo, FalconX and OKX as Ether prices declined more than 10% over the past week.
What to Know:
- Sixteen institutional-grade wallets purchased 431,018 Ether worth $1.73 billion through major cryptocurrency platforms during a three-day period marked by price weakness
- Exchange-held Ether balances dropped to approximately 14.8 million tokens, down 52% from 2016 levels and representing a nine-year low
- U.S.-listed Ethereum exchange-traded funds recorded nearly $800 million in outflows this week, marking their largest redemption period since launch
Exchange Supply Reaches Historic Low
The amount of Ether held on cryptocurrency exchanges has fallen from roughly 31 million tokens to about 14.8 million, representing a 52% decline from 2016 levels, according to analytics firm Glassnode. The reduction reflects a shift toward staking contracts, cold storage solutions and institutional custody arrangements.
The recent launch of the first Ethereum staking exchange-traded fund has accelerated the movement of tokens away from trading platforms. Lower exchange balances reduce the immediate selling pressure on markets but can amplify price volatility when large orders execute. Traders note that reduced liquidity on exchanges makes price movements more dramatic during periods of heightened activity.
Price Action and Technical Pressure
Ether traded at $4,011 as of Monday afternoon, down 0.33% over 24 hours and declining more than 10% across the previous seven days, according to TradingView data. The token briefly dropped below $3,980 during the session before recovering to current levels. The two-week pullback has brought Ether back to the $4,000 support zone that traders consider psychologically significant.
Cryptocurrency analyst Ted Pillows identified the $3,700 to $3,800 range as a critical threshold.
A break below $3,700 could trigger liquidations of leveraged long positions, potentially accelerating downward price momentum through forced selling. Market participants watch this level closely as margin exposure remains concentrated in that zone.
Short-term price swings have intensified as holders adjust positions. The combination of reduced exchange supply and clustered margin positions creates conditions where rapid price movements become more likely, even as longer-term demand indicators suggest sustained institutional interest.
Institutional Fund Flows Shift
U.S.-listed Ethereum exchange-traded funds recorded approximately $800 million in outflows during the current week, marking the largest redemption period since these products began trading. Despite the withdrawals, roughly $26 billion remains invested in Ethereum ETFs, representing 5.37% of the cryptocurrency's total supply.
The scale of institutional accumulation stands in contrast to the ETF outflows. Previous data from blockchain analytics platform Lookonchain showed a separate accumulation of roughly $204 million in Ether, displaying similar patterns of large purchasers entering positions during price declines.
The divergence between ETF redemptions and wallet accumulations suggests institutional investors hold differing views on near-term price direction.
Retail traders appear hesitant to add exposure at current price levels. The sequence of purchases from institutional-grade custody platforms indicates some market participants view the decline as an opportunity to build positions, while others await further price clarity before committing capital.
Understanding Key Terms
Exchange balances refer to the total amount of cryptocurrency held in wallets controlled by trading platforms, where tokens remain readily available for immediate sale. Staking involves locking tokens in a network to support blockchain operations in exchange for rewards, removing those tokens from active trading circulation.
Margin positions represent trades made with borrowed funds, allowing investors to control larger positions than their capital would otherwise permit. Liquidation occurs when the value of a leveraged position falls below required thresholds, forcing automatic sale of the position to cover borrowed amounts. Exchange-traded funds hold cryptocurrency assets and trade on traditional stock exchanges, providing institutional and retail investors exposure without directly purchasing tokens.
Closing Thoughts
Large institutional wallets accumulated $1.73 billion in Ether during a recent price decline, even as U.S. exchange-traded funds experienced their heaviest outflows since launch. Exchange-held balances reached a nine-year low of 14.8 million tokens, reducing immediate selling pressure while potentially increasing price volatility. The $3,700 level remains critical, with concentrated margin positions at risk of liquidation if prices break below that threshold.