Ethereum’s exchange supply has plummeted to levels not seen since 2018, potentially signaling an imminent price breakout as on-chain metrics flash increasingly bullish signals. Data from Glassnode reveals that ETH held on centralized exchanges has reached a 7-year low, suggesting strong accumulation by long-term holders.
The second-largest cryptocurrency has demonstrated remarkable strength in 2025, rallying over 100% from cycle lows near $1,600 to test resistance at $2,700. This price action has positioned ETH as a market leader, with many analysts suggesting this could be the catalyst for a broader altseason. Recent analysis indicates Ethereum could target $10,000 if current support levels hold.
Exchange Supply Drain Points to Accumulation Phase
The dramatic reduction in exchange-held ETH represents a significant shift in market dynamics. When investors move assets off exchanges into self-custody solutions, it typically indicates a strong conviction in future price appreciation. This behavior often precedes major market moves, as reduced liquid supply can amplify price movements when demand increases.
Technical Analysis Points to Critical Support
ETH currently trades at $2,484, consolidating above crucial support at $2,450. The 4-hour chart shows a series of higher lows, suggesting bulls are defending key levels despite recent market volatility. A breakout above $2,700 could trigger significant buying pressure, especially given the limited supply available on exchanges.
FAQs About Ethereum’s Exchange Supply
Q: Why is low exchange supply bullish?
A: Reduced exchange supply typically indicates less selling pressure and stronger holder conviction, often preceding price increases.
Q: What could trigger an ETH breakout?
A: A combination of low supply, increased institutional interest, and technical breakout above $2,700 could catalyze a major move higher.
Q: How does this compare to previous cycles?
A: The current exchange supply level matches 2018 lows, which preceded Ethereum’s rally to all-time highs in the following cycle.
Outlook and Key Levels to Watch
While short-term price action remains choppy, the confluence of reduced exchange supply and strong technical support suggests Ethereum could be preparing for its next major move. Traders should watch the $2,700 resistance level, as a breakthrough could trigger accelerated buying pressure in an environment of limited available supply.