Ethereum has witnessed net exchange outflows totaling $1.1 billion this week, according to Sentora. Investors are reportedly transferring Ethereum into self-custody due to concerns surrounding smart contracts, which is impacting market liquidity. According to NS3.AI, this trend reflects a growing caution among investors as they seek to mitigate risks associated with smart contract vulnerabilities. The movement of Ethereum into self-custody is contributing to reduced liquidity in the market, highlighting the ongoing challenges faced by the cryptocurrency sector.