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Ethereum supply tightens as institutions and staking reduce liquid ETH, weakening retail participation.

Market News
27 May 2026
AMBCrypto
View Source
Neutral
pluang ai news

Ethereum's liquid supply is shrinking due to strong institutional buying and increased staking, which locks up a significant portion of ETH. This supply compression has pushed exchange reserves to multi-year lows and shifted value capture toward Layer-2 networks and stablecoins rather than ETH itself. Retail investors are pulling back, with smaller wallets reducing holdings, while institutional concentration may stabilize prices but also increase volatility risks. Going forward, Ethereum's market may see sharper price reactions due to lower liquidity and changing participation dynamics.

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