Crypto analyst KookCapitalLLC has stated that Ethereum (ETH) is now highly devalued compared to Bitcoin (BTC), the first time since 2019.
Historically, such events have contributed to ETH outperforming BTC. The analyst presented several on-chain indicators that supported his assessment.
According to the metrics, the MVRV ratio shows that ETH has now become a massively devalued asset compared to BTC. It is the first time this has happened since 2019. Past records show that such happenings have often led to ETH outperforming BTC. However, factors like slow trading actions, decreased demand, and increased supply concerns could obstruct a possible recovery.
Past records indicate that whenever this MVRV ratio moves into the undervalued region, ETH has a tendency to perform much better than BTC, usually leading to massive price surges like the one seen in 2019. The current digital asset market is in 2023. Interestingly, the MVRV ratio has moved into the undervalued region, currently at 0.4, indicating that ETH could be undervalued against BTC.
This aligns with the market cap analysis, which also suggests that ETH is undervalued compared to BTC, especially considering the significant price difference between the two assets.
Furthermore, the analyst noted that BTC is just a 2.5x price increase away from its all-time high (ATH) of $78,000, while ETH is still has a long way to go to reach its ATH of $4,878, last seen on November 10, 2021.
This price pressure may stall a Bitcoin price recovery, while the increased activity in the Ethereum network suggests that the token is being massively accumulated by long-term buyers and short-term traders.
ETH’s move towards its previous ATH may trigger higher optimistic sentiment in the broader cryptocurrency market, especially as Ether is a major token for NFT and DeFi trading.
