Analytics from cryptocurrency on-chain metric aggregator IntoTheBlock indicate that there has been a massive movement of Ethereum (ETH) from cryptocurrency exchanges to external addresses.
The data shows that since February 22, over 327,000 ETH were moved from exchanges into external wallets. This sum was a part of a seven-day consecutive outflow from exchanges, although this has subsequently led to a declining supply on trading platforms like Coinbase and Binance.
What is the Impact on Ethereum?
“$ETH has seen 7 days of consecutive outflows from exchanges. As the price increases, the supply available to buy from exchanges has been decreasing non-stop in 2021. Over 327,000 ETH left exchanges since Feb 22nd.” – @IntoTheBlock via Twitter.
Overall the large movement of Ethereum indicates increasing adoption among the masses. Following the seven-day period of high exchange movement, Ethereum broke past the $3,000 psychological barrier and settled a peak of $3,045 ($4,162 AUD) on March 2.
Glassnode (Blockchain data aggregator firm) shared data on ETH 2.0 Deposit Contract breaking Total Value Locked (TVL) milestones, reaching an ATH of 9,698,594 ETH at the start of March.
This combined with the aforementioned adoption among the masses paves the way for a very bullish trajectory. But that’s not all: Ethereum actually achieved another milestone at the start of the month in reaching 300,000 Ethereum 2.0 validators, which once again, correlates to the early March uptrend. This figure represents the participants that are preparing Ethereum for the shift from a Proof-of-Work (PoW) system to the Proof-of-Stake (PoS) consensus algorithm, a long-awaited update that will drastically improve upon Ethereum on several fronts i.e. environmental, security and scalability.
Market volatility due to war persists
Unfortunately, the uptrend from the large Ethereum movement didn’t last. From March 3 onwards, Ethereum dropped steeply to $2,500-$2,600 (approx. $3,480 AUD), losing much of the growth it saw. Between surging inflation, interest rate hikes from the Federal Reserve, and the Ukrainian-Russian crisis, the drop was predictable, and reflects the heightened volatility that comes with war.
If there’s any solace to be found though, it’s in the fact that Ukraine has managed to benefit from crypto. On March 2, an NFT of Ukraine’s flag was sold for over $6.75M ($9.21M AUD) in a campaign to raise money to help Ukrainians affected by Russia’s invasion.
This movement, dubbed UkraineDAO, is a project organised by Russian art collective Pussy Riot, NFT studio Trippy Labs, DeFi collective PleasrDAO, NFT startup CXIP, and a slew of Ukrainian humanitarian activists. In total, efforts to assist Ukrainians affected by the conflict have already amassed over $50 million in crypto donations. On top of this, Mykhailo Fedorov (Ukraine’s Vice Prime Minister) tweeted plans that the Ukrainian government will be planning to mint NFTs in order to fund its military.
In spite of current market conditions and looming hurdles, experts still remain optimistic. Whether it’s Bloomberg Intelligence’s Mike McGlone believing Ethereum could break $4000 by the year’s end, or ARK Invest’s longer-term predictions of $180K by 2030, the HODL sentiment continues to remain relatively firm.
