Ethereum exchange inflows plunge 90%… “Rebound possible”

As meaningful signals have emerged in Ethereum’s on-chain indicators, the prospect of a structural rebound is being raised.

After forming a low around $1,800 the previous day, Ethereum (ETH) rebounded more than 3% within a day and, as of the 25th (KST), is trading around $1,890 on CoinMarketCap.

BeInCrypto, a specialist outlet covering digital assets (cryptocurrencies), said, “Ethereum is already showing the early stages of a recovery,” adding, “On the short-term chart, a symmetrical triangle pattern and a bullish divergence in the Relative Strength Index (RSI) were observed. While price made lower lows, the RSI made higher lows—typically indicating that selling pressure is weakening,” it analyzed.

The most notable change is exchange inflows. According to Santiment data, exchange inflows, which had risen to about 1.06 million ETH seven days ago, have recently fallen to roughly 126,000 ETH—down about 90%. In general, coin transfers to exchanges are interpreted as intent to sell. The fact that exchange inflows plunged even as the price fell about 14% suggests that spot selling pressure has eased sharply.

In the derivatives market, large-scale deleveraging (reductions in leverage) appears to have already progressed to a significant extent. According to CryptoQuant data, stablecoin-margined Ethereum open interest (OI) on major exchanges fell sharply in tandem after peaking on the 17th of last month. At the time, Binance and Gate.io each exceeded $4 billion, while Bybit was around $1.26 billion. However, as of the 24th, Binance had been reduced by more than half to about $1.93 billion, and Bybit also declined to $866 million.

This sharp drop in OI is interpreted less as a simple bearish signal and more as a flow akin to a “capitulation zone,” where excessive leveraged positions are flushed out. In fact, when OI plunged last June, Ethereum formed a major low around $2,200 and then sustained a rebound.

At the same time, Tether (USDT) dominance rose to around 8.5%. Tether dominance refers to Tether’s share of the total market capitalization and typically rises during risk-off phases. However, in June and September 2023, it formed overhead resistance around 8.5%, after which funds flowed back into the crypto market. At the time, Ethereum built a base in the $1,500 range before rebounding.

CryptoQuant contributor Amr Taha focused on the simultaneous emergence of derivatives-market deleveraging and a peak in stablecoin share, saying, “This is a signal that increases the likelihood of a regime shift via renewed inflows after short-term fear has been maximized,” he analyzed.

Long-term holder behavior has also shifted. According to Glassnode, the long-term holder net position change indicator—showing a net-selling trend since early February—has recently turned to net buying. A flow that had at one point shown net selling of more than 41,000 ETH has recently swung to net accumulation of more than 6,000 ETH. This suggests long-term investors may have begun re-accumulating on the perception of a bottom.

From a technical perspective, $1,920 is presented as the first resistance level for Ethereum. BeInCrypto said, “If Ethereum decisively breaks above $1,920, the $2,020 and $2,060 areas are the next resistance zones.” If it breaks above $2,060, the rebound could extend to $2,200 and further to $2,420.

However, if the rebound fails to persist and the price turns lower, the initial support level is cited at $1,741. Investment outlet FXStreet said, “If the $1,741 area breaks, $1,524 is the next support,” adding, “If selling pressure accelerates, the possibility of an expanded drop to $1,404 cannot be ruled out.”