Data from the Ethereum Exchange Supply Ratio (ESR) on Binance indicates a significant increase in exchange supply during May before gradually declining in recent days. According to the data, the ratio rose to approximately 0.0326 in May, marking its highest level since February, coinciding with ETH trading near $2,370 at its recent peak.

Although the ratio later retreated to around 0.0320 as Ethereum’s price declined toward $2,128, it remains near its highest level since early February, reflecting a relatively elevated supply on Binance compared to previous months.

This increase follows a prolonged period of gradual supply reductions during March and April, when the ratio fell below 0.029. That period coincided with more stable price movements and a relative decline in short-term trading activity. The ratio’s rebound in May may reflect increased investor and trader activity, alongside rising volatility and a return of liquidity to the market.

It is important to note that an increase in supply within trading platforms does not necessarily indicate an immediate sell-off. However, it typically reflects greater market flexibility and a larger amount of assets available for immediate trading, which may increase the likelihood of price volatility if selling pressure intensifies or investor sentiment changes in the coming period.

Written by Arab Chain