An analysis said selling pressure from Ethereum miners has fallen to its lowest level in about a year. While reduced supply-side strain has improved conditions for a price recovery, institutional demand needs to underpin any move into the next upswing.

On July 30 local time, blockchain outlet The Crypto Basic reported that CryptoQuant's analysis team assessed that downside pressure on Ethereum has eased.

CryptoQuant analyst PellineiPA said miners' transfers of Ethereum to Binance have neared the lowest level of the past year. As Binance is the most active exchange for Ethereum spot and futures trading, miners sending coins there is seen as a potential sell signal.

Most of the large transfer spikes seen in recent months have also disappeared. Transfers rose at one point in June but then fell quickly, and by late July they had dropped back to near baseline levels.

PellineiPA said miners are a natural source of Ethereum supply and that fewer coins moving to exchanges reduces the amount of ETH available for immediate selling. That structure makes it easier for buying to absorb market liquidity. He said supply declines alone do not lift prices, adding that while reduced miner selling can lower downside risks, Ethereum is still trading in a range because demand has not accelerated. He said a new wave of institutional buying is needed as a catalyst for the next major upward move.

Recent fund flows were mixed. Ethereum spot exchange-traded funds sold $18.65 million of ETH in a single day in late July, while they had accumulated daily net purchases totaling $23.76 million in the same week. That shows it is difficult to shift the trend if demand does not follow through consistently even when supply pressure eases.

Another CryptoQuant analyst, CryptoGeno, said Ethereum has started to regain relative strength against bitcoin after months of sluggishness. He said the ETH/BTC market value to realized value ratio has rebounded from a historically undervalued zone and moved above its long-term average. In past cycles, such a recovery was interpreted as a signal that capitulation selling had passed and Ethereum was improving its performance versus bitcoin.

Exchange inflows have also eased. The ETH/BTC exchange inflow ratio has fallen well below levels seen in the previous distribution phase. That means less Ethereum is being sent to exchanges and short-term selling pressure has also eased. CryptoGeno said bitcoin still leads overall activity on a weekly spot trading basis. He added that it is notable the decline in the ETH/BTC trading volume ratio has stopped and begun to stabilise.

This indicator has often improved ahead of Ethereum's relative strength in the past. It also aligns with a pattern seen when interest from institutional and retail investors broadens from bitcoin to other cryptocurrencies.

CryptoGeno said the market has not yet fully entered an altcoin-led phase. While Ethereum is regrouping on a stronger on-chain foundation, he said sustained gains would require larger capital inflows, limited exchange selling and stronger spot market participation.

Ultimately, both analysts shared the view that supply-side conditions have clearly improved. With reduced exchange inflows from miners and holders, selling pressure has weakened, but a sustained Ethereum rally would require larger capital inflows, limited exchange selling and a recovery in spot market participation. If those conditions are met, the market is likely to test the possibility of Ethereum breaking back above $2,000.