As ether (ETH) continues to tiptoe around the $1,900 price range, a bullish catalyst has emerged which may make the breakout through the $2,080 resistance level a lot more likely in the coming days. Notably, ETH miners’ selling has reached a historic low.
ETH miners significantly reduce selling
According to exchange data received on Wednesday, the amount of ETH transferred to Binance crypto exchange has plunged to a historic low in recent days. Somewhat large spikes seen in the previous months have been replaced by historically low transfer volumes.
The following chart confirms the aforementioned claim, as a brief increase in ETH quantity in June was offset by miner transfers falling to baseline level by the end of July, indicating a positive signal for ETH’s price.
When miners send fewer coins to exchanges, the amount of ETH readily available for sale decreases, reducing immediate supply pressure on the market. Here, using Binance as a reference is particularly important.
As the world’s leading exchange for both spot and futures ETH trading, Binance provides one of the most reliable indicators of potential selling pressure. The fact that miner transfers to Binance have dropped to such low levels suggests that miners are not contributing meaningful selling pressure to the market.
Lower supply from miners is generally a supportive factor for price. However, this metric alone does not guarantee a price increase, since demand for the underlying asset must also strengthen in tandem.
Institutional demand is missing
While low miner selling on exchanges is a bullish factor, a key factor that is missing currently is the tepid institutional demand for ETH. Ethereum treasury firm Bitmine continues to buy the digital asset, but one company buying is not nearly enough.
A new wave of institutional buying could just be the catalyst for the next upward move. For example, unlike ETH, Bitcoin (BTC) has multiple institutional buyers not only from the corporate realm but entire nation states themselves.
If ETH experiences a similar adoption force, its price could propel beyond the psychologically important $2,000 level. Some encouraging signs are starting to emerge, including enhanced network activity over the past few weeks.
