CryptoQuant analysts name a key factor for Ethereum’s further growth

CryptoQuant analyst CryptoMe said that the decline in Ethereum reserves ETH $4,095.14 Bridged Ether (StarkGate) -1.31% Market capitalization $95.77 million VOL. 24 hours $1.5 billion on spot exchanges may indicate that the market is preparing for an increase in the asset’s price. According to him, the main reason for the outflow of coins is new purchases, after which investors withdraw ETH to personal wallets for non-consumptive storage or staking. This behavior indicates confidence in the asset and long-term expectations.

Despite this, the Ethereum exchange rate remains stable: purchases are balanced by sales, and the decrease in stocks has not yet affected the market value. The analyst recalled that in previous periods, the reduction of reserves preceded a rally, as a decrease in supply created conditions for growth.

At the same time, CryptoMe emphasized that this is not a «supply shock» in the classical sense, but rather a decrease in liquidity. In his opinion, the main factor that is needed to start a new breakthrough is the growth in demand.

The analyst also noted the metric of the «realized price of the storage whales». He sees a decline in ETH below this level as a buying opportunity. In addition, he emphasized that the long-term outlook for Ethereum remains bullish, provided there is no recession and the Fed continues its easing policy.

Currently, the ETH rate has stabilized at around $ 4000 due to a sharp drop in open interest, which has reduced the pressure of sellers. At the time of publication, the coin was trading at $ 4128.