CME data shows a record-high net short position on ETH, raising the risk of a massive short squeeze as accumulation intensifies.
Ethereum’s available supply has plunged following a historic daily accumulation of over 1 million ETH by large whale wallets. The aggressive buying spree arrives as fundamentals improve and exchange balances decline. This confluence of metrics is now driving expectations of a bullish reversal in the ETH market.
Addresses holding between 1,000 and 10,000 ETH rapidly increased their holdings, adding over 1 million ETH in a 24-hour window. This sharp spike marked the largest daily net inflow into whale wallets since 2018.
As their total holdings surpassed 14.3 million ETH, on-chain liquidity visibly tightened across major exchanges.
Ethereum Foundation further amplified this trend by transferring 9,000 ETH to a Gnosis Safe wallet in under a month.
The destination wallet received ten separate 1,000 ETH transactions, with the latest valued at $2.45 million. Such fund movements often precede OTC activity or staking strategies, reducing market float.
The aggressive shift in whale behavior has pulled available supply off the market at a critical technical zone. ETH’s price rebounded quickly from support near $2,100 and is now testing levels above $2,500. If price holds above $2,300, analysts anticipate a surge toward $4,000 as supply constraints deepen.
Institutional traders on the CME remain heavily positioned against Ethereum, with a record net short position of over 11,000 contracts.
These extreme bearish bets contrast with rising on-chain strength and increasing whale interest. This divergence increases the probability of a short squeeze if ETH rallies further.
At the same time, Ethereum’s DeFi ecosystem is showing signs of revival. Total value locked (TVL) on the network has risen back above $120 billion, a level last seen in late 2021. This renewed confidence in Ethereum protocols is restoring user activity and capital allocation.
Stablecoin supplies on Ethereum are also trending upward, suggesting idle capital is returning to the ecosystem. This signals potential for increased buying pressure, especially when coupled with reduced ETH availability. With fewer sellers and rising demand, market dynamics now lean bullish.
