Data indicates that Ethereum’s scarcity index on Binance reached a record high of 2.47 in April. This peak signifies that available supply was significantly constrained relative to demand, reflecting maximum scarcity during that period. Such elevated readings are often associated with conditions where upward pressure is likely due to tightening supply.

While the index has retreated from this peak in recent days, it remains above 1, suggesting that the current pullback does not reflect fundamental weakness, but rather a natural correction following exceptional levels. Remaining above this threshold indicates that scarcity persists, albeit at a more moderate pace compared to the April peak.

The move from a historic high of 2.47 to levels still above 1 suggests that underlying strength remains intact, with the current phase representing a period of rebalancing. This behavior indicates that supply-related pressures are still present, which may help support price stability or lead to gradual price movements in the near term.

the record high in the scarcity index reflects a period of strong supply tightening, while the subsequent decline paired with sustained positive levels confirms that this effect has not disappeared. Instead, it remains a supporting factor, reinforcing a broader trend underpinned by Ethereum’s ongoing scarcity.

Written by Arab Chain