Ethereum Price Dives After Clarity Act Failure, but On-Chain Data Suggests Reduced Sell Pressure

Ethereum's price dropped to $2,400 on Tuesday after the Clarity Act failed to advance in the Senate. The bill needed 60 votes but was opposed by Senate Republicans.

The failure of the Clarity Act led to a 5% sell-off, but on-chain data shows that over 140,000 ETH ($350 million) left exchanges within a 96-hour window. Analyst Ali Martinez noted this trend, saying: 'With less $ETH available on exchanges, potential sell-side pressure is declining, strengthening the case for a bullish breakout.'

Exchange reserves have dropped from 22.9 million ETH in June 2020 to just 6.06 million, according to Santiment. This decline is tied to staking, ETF holdings, and treasury companies like Bitmine, which now holds 4.9% of Ethereum's total supply.