The movement of Ethereum’s net flows on spot exchanges is important for understanding price dynamics. Net outflows indicate that ETH is moving to cold wallets, reducing selling pressure, which is a positive signal for the price. On the other hand, net inflows indicate that investors are preparing to sell, creating downward pressure on the price.

In early 2022, the price of Ethereum fell from $4,000 to $1,000 due to the dominance of net inflows. Since July 2022, net outflows have begun to prevail, and the price of ETH has begun to recover.

For the Ethereum price to rise, it needs sustained net outflows, which reduce the supply of ETH on exchanges, maintaining the balance in favor of demand. This helps the price rise, but sudden inflows can create short-term selling pressure.

Ethereum’s sustained net outflows support its price growth and are important for the expected altcoin season. Net ETH flow data on spot exchanges is a critical indicator for investors.