If this is true, it means that ETH will have much greater upside potential than in previous cycles.
"There is a new flow of capital towards Ethereum," says Carmelo Alemán.
Ether (ETH), the cryptocurrency of Ethereum, has captured the market's attention this July, with a staggering 60% rise in its price, which went from 2,398 to 3,850 dollars.
In general, as I have been reporting, it is believed that the usual cycle of cryptocurrencies is repeating and capital is rotating from bitcoin to ETH.
However, analyst Carmelo Alemán challenges this narrative and suggests that the story is different.
The idea that investors are selling bitcoin to buy ETH has gained traction, but is it true? Alemán refers to the realized capitalization of bitcoin, a metric that reflects the market value of BTC according to the price at which each unit last moved on the network.
The data, according to Alemán, is clear. On July 25 at 11:00 UTC, this metric reached an all-time high of 1.018 trillion dollars. This indicates that the capital invested in bitcoin not only remains but grows, ruling out a massive outflow to Ethereum, according to his interpretation. This can be seen in the following graph.
So, what drives the rise of Ethereum? According to Alemán, a key factor is the signing of the GENIUS Law by President Donald Trump, which aims to regulate and promote stablecoins in the United States.
Ethereum, as the main network for these assets, is well-positioned to benefit. Its robust and expanding ecosystem attracts new capital without investors abandoning their positions in bitcoin.
“There is a new flow of capital towards Ethereum,” says Alemán, emphasizing that this growth does not depend on a rotation from BTC, but rather on money coming directly into ETH from those who have understood the importance of this ecosystem.
If Alemán's narrative is correct, the surge of Ethereum could have a much greater trajectory than in previous cycles. The combination of a booming ecosystem, the backing of new regulations, and the influx of fresh capital positions ETH as a key player in the market.