Ethereum Exchange Holdings Return to Levels Seen 10 Years Ago... On the Eve of a Surge or a Crash Signal, Which Is It?

▲ Ethereum (ETH)

Ethereum (ETH) holdings on cryptocurrency exchanges have fallen to their lowest level since 2016, raising concerns that severe price volatility could intensify due to a supply shortage.

According to cryptocurrency-focused media outlet NewsBTC on February 10 (local time), the amount of Ethereum held by exchanges has declined to levels comparable to mid-2016, nearly a decade ago. Such unusually low exchange balances indicate a sharp reduction in immediately tradable supply and are expected to become a decisive factor in future price formation.

A report from CryptoQuant attributes this trend to investors’ growing preference for long-term holding, increased participation in staking, and capital inflows into decentralized finance (DeFi) services. While a reduced circulating supply can act as a catalyst for sharp price surges if demand suddenly spikes, the Ethereum market is currently testing the $2,000 level under strong downward pressure.

Technical analysis shows that Ethereum is trading below its 50-day, 100-day, and 200-day moving averages, remaining firmly in bearish territory. Since late 2025, market structure has begun to deteriorate, with a continuing downtrend marked by lower highs, leaving the critical psychological support zone between $2,000 and $2,100 extremely fragile.

If the $2,000 level decisively breaks, the decline could accelerate further, with risks of additional pullbacks toward $1,700 or even $1,500. Although limited supply can amplify volatility, the weakness of recent rebounds suggests that genuine buying demand is still insufficient to defend against price drops.

While over-the-counter (OTC) balances have recently seen a slight increase, this has not been enough to fully offset the sharp decline in exchange-held supply. Ethereum’s future direction is expected to be determined by broader macroeconomic conditions and capital flows. As the potential explosiveness of a supply shortage collides with technical weakness, market participants are closely watching whether the $2,000 support level can hold.

*Disclaimer: This article is for investment reference only, and no responsibility is taken for any investment losses based on it. The content should be interpreted solely for informational purposes.*

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