Ethereum May Have Reached a Decisive Turning Point Against Bitcoin

The ETH/BTC price ratio jumped 38% last week after hitting its lowest level since January 2020. Could this dramatic development herald the long-awaited start of a new “altcoin season”?

According to a recent report by CryptoQuant, Ethereum (ETH) may have finally started putting in decisive turning point against bitcoin (BTC).

The ETH/BTC price ratio soared 38% last week after hitting its lowest level since January 2020.

Could this dramatic development be signaling the long-awaited start of a new "altcoin season"?

Technical Signals Confirm a Possible Trend Reversal

According to researchers from CryptoQuant, Ethereum is currently being massively undervalued compared to bitcoin.

The ETH/BTC MVRV indicator (Market Value to Realized Value), which compares the current market value to the average acquisition value of the two cryptos, has reached a low level not seen since 2019.

This detail is crucial because the last time this indicator hit such lows, Ethereum subsequently experienced an exceptional growth period against bitcoin.

"The last time the ETH/BTC MVRV reached such low levels was during the 2019-2021 bull market. After hitting lows in late 2019, ETH experienced a relative outperformance against BTC, with its price multiplying by four compared to bitcoin during that period, ” explained CryptoQuant researchers.

Moreover, trading between ETH and BTC is intensifying significantly. The volume ratio reached 0.89 last week, a record since August 2024.

To put this in perspective, this means traders are increasingly positioning themselves on Ethereum rather than bitcoin.

CryptoQuant experts see a striking similarity with the 2019-2021 period.

Specifically, during that period, the ETH/BTC price ratio rose from about 0.02 to over 0.08, reflecting a massive outperformance of Ethereum against bitcoin.

This trend appears to be continuing, and if the price ratio manages to break out of its 365-day moving average, it could signal a decisive shift in favor of Ethereum.

Ethereum’s price has already been rebounding for several weeks, a sign that investors are regaining confidence in its potential.

At the time of writing this article, it trades at $2,347, up 57% in one month.

Peter Brandt, a well-known technical analyst, recently changed his stance on Ethereum, shifting from a bearish outlook to a bullish projection with a potential target of 4,000 dollars.

This optimism is shared by other market participants, who are closely following the signals of large institutional investors.

Institutional Interest and Decreased Selling Pressure Fuel Optimism

Large institutional investors are massively returning to Ethereum. The proof ? Ethereum ETFs have been recording continuous growth in assets under management since the end of April.

This renewed interest is no coincidence: it coincides with the announcement of major technical upgrades such as EIP-7928, which promises to significantly improve network performance.

A particularly encouraging signal comes from CryptoQuant’s data on ETH movements: transfers to exchanges are at their lowest since 2020.

This metric is essential to understanding market dynamics.

When less ETH arrives on exchanges, it means holders are less inclined to sell their tokens, thus reducing the downward pressure on the price.

The ETF holdings ratio and price ratio of ETH/BTC are increasing simultaneously, a sign that institutional investors are rebalancing their portfolios in favor of Ethereum.

This trend is accompanied by major technical developments such as the recent proposal for parallel transaction execution on Layer 1, which could fundamentally transform the network architecture.

However, CryptoQuant analysts remain cautious. To definitively confirm this trend reversal, a major technical hurdle must still be overcome: the ETH/BTC ratio must exceed its 365-day moving average.

Simply put, Ethereum must maintain its outperformance against bitcoin over a sufficiently long period to validate this new bull cycle. If this condition is met, we could witness sustained growth for Ethereum in the coming months.

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