Fantom Supply On Exchanges See Drastic Increase, A Cause For Alarm?

In simple terms, the amount of Fantom (FTM) held on cryptocurrency exchanges has increased significantly lately, fueling concerns about potential price drops for this digital currency. Historically, such upticks in exchange balances have often signaled unfavorable market conditions for FTM investors.

Fantom Supply On Exchanges Rise By 16 Million

Over the past month, the Fantom price surged and hit a new peak of over $1.2, marking a three-year high. Yet, this upward trend proved temporary, and Fantom started giving back its March gains little by little during the previous week.

An significant factor contributing to the price drop is the excessive selling by FTM owners, many of whom have held onto their coins for an extended period. This mass selling has caused a surge in the supply of Fantom tokens on centralized exchanges, leading investors to rush and sell off their tokens to realize profits.

According to Santiment’s on-chain data, approximately 16 million worth of FTM tokens moved from wallets to centralized exchanges within the last week of March. Consequently, their exchange balances increased from around 654 million to over 670 million during this period.

The decrease in Fantom’s price from over $1.1 to $0.84 happening at the same time as an increase in inflow indicates that these investors selling Fantom tokens may be causing the price drop. To bounce back, a change in this downward trend among sellers is necessary.

Bullishness On FTM Not Dead

Millions of FTM flowing into centralized exchanges may signal bearish trends temporarily. However, crypto market dynamics suggest that sellers will eventually exhaust their supply. Once this happens, demand can overtake the available FTM supply, causing a price reversal.

The number of people adopting Fantom has been rising, with founder Andre Cronje frequently discussing it on X (previously known as Twitter). According to Santiment’s data, the number of FTM holders grew in tandem with the price increase in March. Specifically, between March 17 and 28, the Fantom chain gained over 2,000 new holders, bringing the total to over 111,000.

The current downtrend in Fantom’s price may not last, as it could potentially regain momentum and increase once more, with the previous support level at $0.8 being a strong possibility for another price surge.

Currently, the price of FTM is at $0.84. This represents a decrease of 5.48% over the last day and 18.2% in the past week. The market capitalization of FTM amounts to $2.37 billion, placing it as the 51st largest cryptocurrency in existence.

Fantom Supply On Exchanges See Drastic Increase, A Cause For Alarm?

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2024-04-04 16:16