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▲ Ethereum (ETH)
Despite increased on-chain activity in early May, Ethereum (ETH) has failed to achieve a clear breakthrough, remaining in a short-term sideways trend. With large amounts of ETH flowing into Binance and exchange holdings increasing, analysis suggests that unstable movements by large holders are limiting attempts at price increases.
NewsBTC reported on May 10 (local time), citing analysis from cryptocurrency analyst Darkfost, that Ethereum network's on-chain activity increased in early May. Darkfost explained that the resurgence of Ethereum's activity coincided with a sideways trading range between $2,250 and $2,450.
Notably, large-scale hourly ETH inflows have been observed multiple times on Binance since the beginning of this month. On May 6, approximately 216,152 ETH, worth about $511 million, moved to Binance. On May 8, 98,552 ETH, valued at around $224 million, flowed in, and on May 9, a total transfer of approximately $288 million was observed.
NewsBTC noted that these large inflows occurred in conjunction with Ethereum's correction phase. This interpretation suggests that investors are likely reacting emotionally to short-term price fluctuations rather than engaging in calculated profit-taking. As large holders move more assets to exchanges, the market inevitably becomes aware of a potential increase in sellable supply.
Ethereum holdings on Binance have also increased. According to Darkfost, approximately 3.62 million ETH are currently held on Binance, accounting for about 24.6% of the total Ethereum holdings across all exchanges. Generally, an increase in exchange holdings is considered a neutral or bearish signal, as it indicates a rise in potentially sellable supply. Conversely, a decrease in exchange holdings is interpreted as investors moving assets to personal wallets for long-term holding.
This increase in Binance holdings is the reason why Ethereum has failed to secure higher price levels despite intermittent upward momentum. Darkfost believes that the short-term instability of large holders has been a key factor limiting Ethereum's attempts to rise in recent weeks. NewsBTC reported that Ethereum has not yet shown a clear intention to break out of its sideways trading range.
However, analysis also suggests that if the increase in exchange holdings slows down and price strength recovers, bullish sentiment surrounding Ethereum could revive. As of the time of writing, Ethereum was trading around $2,329, having risen by only 0.6% in the last 24 hours.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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