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Bitcoin (BTC) has been getting the most press coverage lately as its soared past $41,000 last week but Ether, the world’s second-largest crypto by market size, has not been slacking off either. In fact, ETH supply has dwindled and there are even talks that the decreasing supply might no longer be able to keep up with the skyrocketing demand for the cryptocurrency.
Over the past two days, the amount of Ether available for trading and held on crypto exchange has decreased significantly, according to Cointelegraph. At the moment, only 8.1 million ETH are in the reserves of centralized platforms based on data from CryptoQuant.
Ether reserves on centralized crypto exchanges dropped by 10 percent from 11 million to 10 million ETH in just 24 hours, according to Nuggets News’ Alex Saunders. He said that exchanges could run out of ETH in a few days if the trend continues.
“Exchanges could be out of $ETH within 48 hours,” Saunders tweeted. “Demand has skyrocketed. Exchange reserves fell 20% from 10M to 8M in the last few hours. With targets of $5k, $10k & $20k long term, I doubt many HODLers will sell their ETH in the $1-2k range.”
Ether reserves in exchanges fell by 42.5 percent from May 2020’s all-time high of 14.1 ETH.
Other data providers also show that exchange balances have fallen by 42.5% since tagging an all-time high of 14.1 million in mid-May 2020. At the moment, only 7 percent of Ether’s circulating supply is being held by exchanges, the lowest percentage since July 2018 based on data from Glassnode.
However, this could be a good thing for those who own Ether. Saunders believes that the data could mean that, just like BTC, ETH could be on its way to establishing a new all-time high.
“We all know what happened when demand outstripped supply of $BTC,” Saunders explained. “It quadrupled in 90 days.”
Ether (ETH) demand from institutional investors is projected to rise this year fueled by the CME Ethereum futures listing. “CME futures is the writing on the wall,” Ryan Watkins, an analyst at crypto data provider Messari, tweeted. “They wouldn’t launch an $ETH product if there wasn’t any demand for it.”
Institutional investors started seriously buying BTC last year. This year, it could be Ether’s turn, according to the crypto analyst
“In 2021 we begin seeing institutions buy $ETH,” Watkins added. “Once you accept that Bitcoin may be valuable, it opens your mind to the possibility that other crypto-assets may also be valuable. It’s a much easier jump from $BTC to $ETH from there.”
