Ethereum (ETH) Price Surge: Institutional Buying Drains Exchange Balances to Record Lows

Institutional whales are swallowing Ethereum whole, leaving exchanges bone-dry.

Exchange balances for ETH have plunged to their lowest levels on record. The data paints a clear picture: a massive, sustained withdrawal of coins from trading platforms into private custody. This isn't retail FOMO—it's a calculated accumulation by deep-pocketed players betting on the network's long-term future.

The Supply Squeeze Mechanics

When coins vanish from exchanges, available supply shrinks. Simple economics takes over: dwindling sell-side liquidity against steady or rising demand creates upward pressure on price. It's a classic setup for a volatile move higher, as buyers scramble for a shrinking pool of readily tradable ETH. Forget the day traders; this is a game of chess played with nine-figure stacks.

Beyond the Spot Market

The institutional grab isn't happening in a vacuum. It runs parallel to Ethereum's core evolution—its shift to a proof-of-stake consensus mechanism. Staking locks up significant portions of the supply, further constricting circulation. Meanwhile, development continues on scaling solutions and layer-2 networks, aiming to finally tackle those pesky gas fees that still make a simple swap feel like a luxury purchase.

A cynical observer might note this is how every bull run starts: with smart money quietly building a position before the narrative hits the mainstream and your dentist starts asking about yield farming. The institutions aren't here for the tech philosophy; they're here for the ledger that prints money.

TLDR

• ETH exchange balances fell to a record low of 8.7% of total supply, down 43% since July
• Staking, layer-2 networks, and institutional custody are removing tokens from circulation
• On-Balance Volume indicators suggest hidden buying strength despite sideways price action
• ETH holding above $3,000 while facing resistance near $3,200
• BitMine Immersion now controls $11.3 billion in ETH, roughly 3.08% of total supply

Ethereum held on centralized exchanges has reached its lowest level since the network launched in 2015. Exchange balances dropped to 8.7% of total ETH supply last Thursday, according to data from Glassnode.

$ETH is quietly entering its tightest supply environment ever.

Exchange balances just fell to 8.84% of total supply, a level we’ve never seen before.

For context, $BTC is still sitting NEAR 14.8%.

ETH keeps getting pulled into places that don’t sell, staking, restaking, L2… pic.twitter.com/T7MW3D2bG1

— Milk Road (@MilkRoad) December 5, 2025

The figure remained near that low at 8.8% on Sunday. This marks a 43% decline in ETH exchange balances since early July.

The drop coincides with increased activity across the ethereum ecosystem. More tokens are flowing into staking protocols, layer-2 networks, and institutional balance sheets.

Digital asset treasury purchases have accelerated during this period. Long-term custody solutions are also absorbing supply.

Macro research outlet Milk Road noted that Bitcoin’s exchange balance sits higher at 14.7%. The firm said ETH is entering its tightest supply environment in history.

Tokens moving into staking, restaking protocols, collateralized DeFi positions, and self-custody typically do not return to exchanges. These destinations reduce liquid supply available for trading.

Technical Indicators Point to Buying Activity

Market technicians are identifying signals that buyers may be gaining control. Analyst Sykodelic highlighted an On-Balance Volume breakout above resistance late last week.

$ETH looks ready to push much higher

In the last 5 years every single time the 1D RSI has gone from overbought, down to oversold, and then broken the trend(green circle)…

It has pumped a minimum of 45%.

That takes us to $4,300.

That is just the minimum, worst case scenario… pic.twitter.com/hRNL4xIbAv

— Sykodelic(@Sykodelic_) December 4, 2025

The price failed to follow the OBV MOVE higher. This divergence is sometimes seen as hidden buying strength that precedes upward moves.

The analyst noted that price action looks bullish. ETH may revisit higher levels before any meaningful pullback.

Ether has held above $3,000 for nearly a week. The asset faces resistance near $3,200.

Over the past 24 hours, ETH consolidated around $3,050. This mirrors broader market indecision.

The ETH/BTC pair broke above a long-standing downtrend last week. Some traders view this as an early sign of capital rotating back into Ethereum.

Institutional Buying Continues

BitMine Immersion Technologies purchased another $199 million in ETH over the past two days. The firm is already the largest corporate holder of Ether.

BitMine now controls $11.3 billion worth of Ether. This represents roughly 3.08% of total supply.

The company is working toward its stated goal of reaching 5% of total supply. It has continued buying even as some traders position for further declines.

Approximately 40% of all ETH is locked in staking or institutional products. This includes custodial solutions and emerging ETF offerings.

Reduced exchange balances can influence liquidity and short-term volatility. However, this does not guarantee immediate price movement.

Analyst Ali Martinez identified $1,800 as a long-term accumulation zone. This level is supported by a rising trendline from 2022 lows.

Ethereum $ETH at $1,800 looks like one of the best accumulation zones before a bull rally toward $10,000. pic.twitter.com/F49BQ13H2a

— Ali (@ali_charts) December 7, 2025

Analyst Mister crypto noted that only 9% of supply remains on exchanges. This relative scarcity may indicate growing accumulation among long-term holders.

Last month, Tom Lee said Ether may be entering the early stages of an explosive growth cycle. He compared the current market to Bitcoin’s setup eight years ago.

Ethereum’s Relative Strength Index recently shifted from oversold toward neutral territory. Historical patterns show this type of shift has preceded gains of 45% or more in past cycles.

BitMine Immersion added to its reserves over the weekend as ETH traded near $3,050.