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Ethereum reserves have plummeted to a six-year low, casting doubts over the potential for a major bull run in the cryptocurrency market. The recent drop in Ethereum’s spot exchange reserves has reached an unprecedented level of 8.1 million ETH.
Despite this decline, there are signs that buyers may be accumulating long-term positions, which could indicate a shift towards sustained holding. However, with most of its post-election gains eroded, Ethereum’s outlook remains uncertain. The cryptocurrency is currently trading at $2,612, having lost 8% of its market value in the past month.
The data suggests that Ethereum reserves nudged up by 0.62% in January, mirroring a 6% decline for the altcoin during the same period. Meanwhile, XRP’s market capitalization has more than doubled in just 30 days, putting additional pressure on ETH’s already uncertain outlook.
Despite the current slump, Ethereum’s active addresses have jumped 37%, fueling speculation that institutional and decentralized finance (DeFi) demand could be driving this surge. However, even when the Relative Strength Index (RSI) showed extreme overbought levels, there was a lack of capital inflow into Ethereum, which seems to be a major setback for the altcoin.
Ethereum’s performance against Bitcoin remains weak, with the ETH/BTC pair forming lower lows. The cryptocurrency has already lost 8% of its market value this month, putting its outlook in limbo.
Source: ambcrypto.com
