Kraken Exchange is facing a major liquidity crisis, with its Bitcoin and Ethereum reserves hitting historic lows since 2017.

According to blockchain analytics platform CryptoQuant, Kraken's Bitcoin reserves have dropped to 122,300 BTC, a level not seen since 2018. Meanwhile, its Ethereum reserves have fallen below 1 million units, a level not seen since early 2016.

The recent surge in demand for spot Bitcoin ETFs and Ethereum ETFs has contributed to the liquidity crunch. Investors have been buying into the market, driven by the Fear of Missing Out (FOMO) on bullish trends. As a result, crypto reserves on exchanges are drying up, with over 777,000 ETH worth $3 billion withdrawn from exchanges in the past week.

The Ethereum ETF approval from the SEC is barely a week old, and exchanges are already experiencing a drought. The supply shock is likely to impact the prices of these digital assets in the long run.

Currently, Bitcoin is trading at $69,252.47 with a 1.75% increase within the last 24 hours, while Ethereum is at $3,787.97 but is down by 0.21%. Analysts believe that the derivatives market open interest (OI) has greatly improved Bitcoin's bullish outlook to a reasonable extent.

While the market expects a tremendous growth in the price of Bitcoin, Apollo co-founder Thomas Fahrer made a dramatic prediction about the coin. He predicted that the Bitcoin price could reach $3.5 million per coin by 2030. However, the current price trend does not show if Apollo's co-founder is on track. A jump in Bitcoin price might equally trigger a surge in the market value of other digital assets.