Investors are opting for self-custody, leading to a significant decrease in the amount of Ether (ETH) held on centralized exchanges. Reports indicate that the supply of Ether on exchanges has reached its lowest level in years, dropping to 10.6%. This decline in exchange reserves means that fewer tokens are available for sale as investors move their assets to self-custody.
The approval of the first-ever Ether ETF by the US Securities and Exchange Commission has had a massive impact. Since May 23, over $3 billion worth of Ether has been removed from centralized exchanges. Data from CryptoQuant and Glassnode confirms the decrease in Ether on exchanges, with the circulating supply falling to 10.6%.
Unlike Bitcoin, Ether has the potential to benefit from demand pressure as it does not face the same level of “structural sell pressure.” Bitcoin miners occasionally sell BTC to cover mining costs, while Ethereum validators do not have the same operating expenses. Bloomberg analyst James Seyffart believes that the spot Ether ETF has a legitimate chance of launching in June.
Key indicators suggest that June is the likely launching date for the Ether ETF. BlackRock, Franklin Templeton, VanEck, and Invesco Galaxy have updated their S-1 forms with the SEC, indicating progress towards the launch. BlackRock’s updated S-1 form also reveals information about its seed capital investor, who purchased $10 million in shares. The ETF is expected to list and trade under the ticker ETHA.
Crypto analyst Michaël van de Poppe predicts that the anticipation around the ETF could push Ether’s price to surpass its all-time high and reach the $5000 zone. This could also reduce Bitcoin’s dominance in the market cap and allow altcoins to grow. However, there are concerns that Grayscale’s Ethereum Trust (ETHE), which manages $11 billion in funds, could cause Ether’s price to follow the pattern of the Grayscale Bitcoin Trust (GBTC), which saw a significant outflow of $6.5 billion in its first month of approval.
At the time of writing, ETH is trading at $3,815, with a 1% increase in the last 24 hours and a 23% increase in the last 30 days.