While 2022 was a disappointing year for the cryptocurrency market, Ethereum [ETH] underwent a significant upgrade. The network transitioned into the proof-of-stake [PoS] realm through the Merge. A lot has changed for Ethereum ever since. Despite garnering immense backlash, the network stuck to its decision and moved forward. It was recently revealed that there has been a 37% dip in the supply on exchanges which is considered to be a bullish sign for ETH.
Santiment noted that back in September, prior to the Merge, a total of 19.12 million ETH, worth $31.3 billion resided on exchanges. However, now there are only 13.36 million ETH valued at $19.7 billion on these platforms. This further means that there is less of the asset to trade or even sell.
However, this decline could also be linked to the community’s desire to move their funds into self-custody. Following the FTX crash, trust in cryptocurrency exchanges dipped.
In addition to these, an increased amount of ETH is currently being staked. 16 million ETH, or 14% of the supply, are currently staked on the Beacon Chain. This further represents a sizeable sum that will gradually become liquid following the Shanghai hard fork, equal to almost $25 billion. The Shanghai hard fork is expected to occur in March.
Will ETH be able to reclaim $1.7K?
Leaving its counterpart Bitcoin [BTC] behind, ETH was surging by 3.27% over the last 24 hours. The asset rose to a high of $1,562.03 all the way from a low of $1,501.80. At press time, the second-largest cryptocurrency was trading for $1,558.45.
The short-term price chart of ETH indicates that the asset is on an uptrend aiming for $1,600. While this is achievable considering it is quite close to this zone, the community is betting on $1,700.
Additionally, the Relative Strength Index [RSI] revealed that buyers were in the ETH market as the asset hit the overbought zone.