SKN | Binance Ethereum Reserves Fall to Their Lowest Level Since 2021 as ETH Struggles Near $1,700

Key Points:

• Binance’s Ethereum reserves declined to approximately 2.9 million ETH, their lowest level since November 2020, representing a nearly 42% reduction from July 2025.
• Four large Ethereum holders reportedly accumulated ETH between $1,933 and $1,990, but the subsequent price decline has left their positions approximately 6% to 8% underwater.
• Despite declining exchange balances, Ethereum remains approximately 63% below its August 2025 peak, demonstrating that reduced exchange supply has not yet translated into a sustained price recovery.

Ethereum’s market structure is showing a notable divergence: exchange reserves are approaching a five-year low while the cryptocurrency continues to experience substantial price weakness. Binance, one of the largest digital-asset trading platforms, now holds approximately 2.9 million ETH, even as Ethereum recently declined to its lowest price since early July. The development raises questions about investor positioning, available exchange liquidity and whether large holders are accumulating ahead of a potential recovery.

Binance ETH Reserves Reach a Five-Year Low

According to on-chain analyst Darkfost, Binance’s Ethereum reserves have fallen to approximately 2.9 million ETH, a level last recorded in November 2020, when ETH traded near $400. The exchange held more than 5 million ETH in July 2025, meaning its reported holdings have declined by nearly 42% since then.

The trend is also reflected in the exchange’s 30-day average netflows, which have remained predominantly negative. Negative netflows indicate that more ETH has left the exchange than entered it during the measured period.

Such movements can reflect several different strategies. Investors may transfer assets into private custody, move tokens into decentralized finance (DeFi) protocols to pursue yield opportunities or redistribute holdings across trading platforms. Although declining exchange balances can reduce the quantity of ETH immediately available for sale, withdrawals alone do not establish that investors are accumulating or intend to hold their assets long term.

Darkfost noted that sustained reserve declines could eventually create a more favorable supply environment if market demand recovers. However, the current price performance suggests that this potential supply effect has not yet become a decisive bullish catalyst.

Whale Accumulation Meets a Weakening Market

Blockchain analytics platform Lookonchain identified four Ethereum whales purchasing ETH during the latest decline, with two reportedly withdrawing their acquisitions directly from exchanges. Their entry prices ranged between approximately $1,933 and $1,990.

However, Ethereum’s subsequent weakness has placed these positions approximately 6% to 8% below their reported entry levels. BeInCrypto Markets data showed ETH trading near $1,826.23, down 4.26% over 24 hours. Earlier, the token briefly declined to approximately $1,711 on Binance, its lowest level since early July.

The situation illustrates the risks associated with interpreting whale transactions as reliable indicators of market direction. Large purchases demonstrate demand at specific price levels, but they do not guarantee that those levels will hold or that other investors will follow.

Technical Support Becomes Critical for Ethereum’s Recovery

Analyst Ted Pillows identified the $1,700 to $1,720 range as an important support zone after Ethereum rebounded from that area. He warned that a sustained breakdown could expose the cryptocurrency to further downside, potentially toward levels associated with its 2018 market cycle.

In contrast, Ali Charts identified a daily buy signal on the TD Sequential indicator, which is designed to identify potential trend exhaustion. The analyst suggested that a recovery could initially test the 200-day simple moving average near $2,150. This remains a technical scenario rather than confirmation of a reversal.

Another factor complicating the interpretation of exchange outflows is Binance’s reported $6.3 billion hack in October. Some withdrawals may reflect precautionary transfers following security concerns rather than a deliberate long-term accumulation strategy.

Going forward, investors will need to assess whether Binance’s reserves continue declining, whether whale purchases translate into sustained demand and whether ETH can maintain its $1,700 to $1,720 support area. A recovery toward $2,150 would strengthen the near-term technical picture, while renewed selling could undermine confidence in the accumulation narrative. For institutional participants, the key question is whether declining exchange supply eventually coincides with stronger demand, rather than treating reserve movements as an independent signal of market direction.