• Ethereum exchange deposits have spiked recently, implying a large amount of users are transferring their coins to exchanges.
• The relevant indicator here is the “Ethereum active deposits”, which measures the daily total number of exchange addresses that are taking part in some deposit activity currently.
• This indicator has been higher than normal for 2023 and its peak value was even higher than when ETH set its all-time high price in November 2021.
Ethereum Exchange Deposits Have Spiked
On-chain data shows an elevated amount of deposits towards centralized exchanges, suggesting increased short-term selling pressure in the ETH market at the moment.
Relevant Indicator: Ethereum Active Deposits
The Ethereum active deposits metric measures the daily total number of exchange addresses that are taking part in some deposit activity currently. This indicator only keeps track of the unique number of such addresses, meaning that it only counts an address once even if it has been involved in multiple deposit transactions in a single day. The advantage of this limitation is that unique addresses are analogous to unique users on the network, so this metric can tell us about the number of users making deposits to these platforms.
High Value Implies Mass Selloff
When the value of this indicator is high, it means a large number of exchange addresses are observing deposits right now. This suggests that a high amount of users are transferring their coins to these platforms currently and could be indicative of a mass selloff in the market.
Recent Peak Value Highest Since All-Time High
The recent peak value has been significantly more than what has been seen for mostof 2023 so far and has even been higher than when ETH set its all-time high price back in November 2021.
This surge in Ethereum active deposits could be indicativeof increased selling pressure as holders move their coins to exchanges for dumping purposes or other reasons. It will be interesting to see how long this trend continues and what effect it will have on prices going forward.