In the 24 hours between February 8 and 9, Ethereum holders reportedly moved more than 224,000 ETH from centralized exchanges, marking the largest net outflow in nearly two years.

This sudden movement is an indicator of the growing belief in the cryptocurrency’s long-term potential.

Rising Accumulation as Whales Strengthen Positions

Santiment data shows that there are currently 9.63 million ETH, worth an estimated $26 billion, sitting in known exchange wallets. This is the lowest number since August 29, 2024.

According to the crypto insights platform, when investors pull assets from exchanges, it usually suggests they are looking to hold rather than sell, therefore reducing the sell-side pressure and lowering the likelihood of major price drops.

“When assets are moving away from exchanges, it is typically a signal of confidence by investors, who are content with holding for the long-term,” stated Santiment.

However, the platform’s analysts noted that ETH’s performance this year will most likely be decided by Bitcoins ability to stay afloat and rebound to its all-time high.

Interestingly, the outflow has come in tandem with the number of Ethereum whales rising by 2.3% since the beginning of February. According to well-regarded crypto expert Ali Martinez, this accumulation is signaling growing accumulation and reinforcing the bullish sentiment among large investors, even as ETH’s price remains under pressure.

Additionally, a recent CoinShares report also indicated that Ethereum led weekly crypto inflows for the first time in 2025, beating BTC. Traders poured nearly $800 million into ETH-related products, compared to only $407 million that went into the number one cryptocurrency.

Mixed Signals as Short Positions Mount

However, despite the underlying bullishness, hedge funds have dramatically increased short positions on ETH, rising 40% in a week and 500% since November 2024. Historically, such extreme bearish positions can set the stage for a short squeeze, where rapid price increases force short sellers to buy back an asset, further pushing up its value.

Meanwhile, Ethereum spot exchange-traded funds (ETFs) registered record inflows in the last week, adding more than $854 million in that period. Some market observers feel that this institutional backing, coupled with decreasing exchange reserves, could mean that investors are positioning themselves for a potential rebound.

At the time of this writing, the world’s second-largest cryptocurrency by market cap was trading at $2,715, a 2.6% improvement over 24 hours. However, across two weeks and one month, the coin’s value is down 15% and 16.1%, respectively. It is also still more than 44% below its ATH of $4,878 achieved over three years ago.