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The Fantom (FTM) supply on exchanges has been rising in recent times, leading to speculations for what this might mean for the price of the cryptocurrency. Going by trends in the crypto market of when the exchange balances of a particular coin goes up, there might be some pain ahead for FTM investors.
Fantom Supply On Exchanges Rise By 16 Million
The Fantom price had increased over the last month to reach a new three-year high above $1.2. However, this rally was only short-lived and the altcoin has begun to eliminate its gains from the month of March gradually in the past week.
One culprit for this decline in price is the high level of selling that have been taken place among FTM holders, majority of which have been holding their coins for a rather long time. As a result, the available supply of Fantom on centralized exchanges continued to balloon as investors rush to sell off their tokens and capitalize on gains.
Data from the on-chain tracking website Santiment shows that in the last week of March, there was a considerable number of FTM flowing into centralized exchanges. This saw their available balance go from around 654 million to over 670 million in the space of a week, with over 16 million flowing into exchanges.
This inflow trend coincides with the drop in the Fantom price from above $1.1 to $0.84, suggesting that it is indeed the selling pressure from these FTM investors that is responsible for the price decline. Given this, there would have to be a reversal in this selling trend is the FTM price is to recover from here.
Bullishness On FTM Not Dead
The inflow of millions of FTM into centralized exchanges is bearish, but this could only last for the short term. As a rule of crypto, eventually, these sellers will run out of coins to sell, leaving room for demand to catch up with the available supply. At this point, the FTM price will begin to see a reversal in the trend.
There is also the fact that adoption has been increasing on the Fantom chain as founder Andre Conje has been actively talking about it on X (formerly Twitter). Santiment’s data shows that the FTM holder base also grew alongside the price in March. In the week of March 17 and 28 alone, the chain’s holder BASE jumped from 109,000 to over 111,000.
This shows that while the trends are bearish right now, there could be a change soon as the price could resume another leg up. The Fantom price has also established support at $0.8 which could serve as the bounce point for another rally.
Presently, the FTM price is sitting at $0.84, with a 5.48% and 18.2% decline on the daily and weekly charts, respectively. Its market cap is at $2.37 billion, making it the 51st largest cryptocurrency in the space.
FTM price at $0.84 | Source: FTMUSDT on Tradingview.com
Featured image from Coin Edition, chart from Tradingview.com
Disclaimer: The article is provided for educational purposes only. It does not represent the opinions of NewsBTC on whether to buy, sell or hold any investments and naturally investing carries risks. You are advised to conduct your own research before making any investment decisions. Use information provided on this website entirely at your own risk.
