Ethereum may have reached a decisive turning point against bitcoin, according to a recent report by cryptoQuant. The ETH/BTC price ratio increased by 38% last week after hitting its lowest level since January 2020. Could this spectacular evolution herald the long-awaited start of a new 'altcoin season'?
The MVRV ETH/BTC indicator (Market Value to Realized Value), which compares the current market value with the average acquisition value of the two cryptocurrencies, has reached a minimum level not seen since 2019.
This detail is crucial, as the last time this indicator hit such levels, Ethereum subsequently experienced an exceptional growth period against bitcoin.
Exchanges between ETH and BTC are clearly intensifying. The volume ratio reached 0.89 last week, a record since August 2024. In simple terms, this means that traders are increasingly positioning themselves in Ethereum rather than in bitcoin.
Experts from cryptoQuant see a surprising similarity to the 2019-2021 period when ETH multiplied its relative value by four against BTC.
Specifically, during that period, the ETH/BTC price ratio rose from approximately 0.02 to over 0.08, reflecting a massive performance of Ethereum against bitcoin.
The price of Ethereum has already bounced back for several weeks, signaling that investors are regaining confidence in its potential. As of the writing of this article, it is trading at $2,347, with a 57% increase in a month.
Peter Brandt, a recognized technical analyst, recently changed his position on Ethereum, shifting from a bearish perspective to a bullish projection with a potential target of $4,000.
Institutional interest and declining selling pressure fuel optimism.
Large institutional investors are massively returning to Ethereum. What's the proof? Ethereum ETFs have been experiencing continuous growth in their assets under management since the end of April.
This renewed interest is not coincidental: it coincides with the announcement of significant technical updates, such as EIP-7928, which promises to considerably enhance network performance.
A particularly encouraging signal comes from cryptoQuant's data on ETH movements: transfers to exchanges are at their lowest level since 2020. This metric is essential for understanding market dynamics.
When less ETH reaches exchanges, it means that holders are less willing to sell their tokens, thus reducing the downward pressure on the price.
The asset ratio and price ratio of ETH/BTC ETFs are increasing simultaneously, a sign that institutional investors are rebalancing their portfolios in favor of Ethereum.
This trend is accompanied by significant technical advancements, such as the recent proposal for parallel execution of transactions on Layer 1, which could fundamentally transform the network's architecture.
However, cryptoQuant analysts remain cautious. To definitively confirm this trend change, an important technical obstacle must still be overcome: the ETH/BTC ratio must surpass its 365-day moving average.
In simple terms, Ethereum must maintain its superior performance against bitcoin for a sufficiently long period to validate this new bullish cycle. If this condition is met, we could witness a phase of sustained growth for Ethereum in the coming months.
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