Pre-Merge Ether Exchange Inflows of Over $1B Trigger Fears of Price Drop

The cumulative inflow of $1.2 billion is supposedly the largest in six months.

AccessTimeIconSep 15, 2022 at 6:08 a.m. UTC
Updated Sep 15, 2022 at 5:42 p.m. UTC

Omkar Godbole was a senior reporter on CoinDesk's Markets team.

A huge amount of ether (ETH) is being moved to centralized cryptocurrency exchanges leading up to Ethereum's pivotal technological overhaul, the Merge.

The crypto community is worried about a price slide due to the influx of ether into exchanges.

Cryptocurrency lender Nexo deposited 450,000 ETH worth $720 million to digital assets exchange Binance late Wednesday, according to data tweeted by Nansen CEO Alex Svanevik. While crypto exchange Bitfinex received 288,442 ETH worth $490 million.

The cumulative inflow of $1.2 billion is supposedly the largest in six months. The total number of ETH held in centralized exchange wallets has jumped to a two-month high of 25.34 million.

An influx of coins into exchanges is usually taken to represent investor intention to sell, while outflows typically represent an intention to hold for the long term.

"Highest exchange inflows in 6 months. Thanks, Svanevik, for alerting. Again be careful," one Twitter user said.

Trader and analyst Alex Kruger said very high inflows point lower. However, Hal Press, founder of North Rock Digital, tweeted that the two inflows are likely fork-related rather than a predetermined sell program.

Perhaps coins have been moved to exchanges to collect potential Ethereum fork token ETHPOW on an exchange, so those can be liquidated immediately instead of receiving the so-called airdrop in a hardware wallet.

Hochan Cheung, head of marketing at South Korea-based analytics firm CryptoQuant, said the coins have been moved to derivative exchanges, which indicates investors are trying to hedge their position in case of price volatility around the Merge, slated to happen in three hours from now.



Read more about

DISCLOSURE

Please note that our privacy policy, terms of use, cookies, and do not sell my personal information has been updated.

The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.

CoinDesk - Unknown

Omkar Godbole was a senior reporter on CoinDesk's Markets team.

CoinDesk - Unknown

Omkar Godbole was a senior reporter on CoinDesk's Markets team.

Investing in the Future of the Digital Economy
October 18-19 | Spring Studio, NYC