Ethereum (ETH) may be on the cusp of a powerful reversal against Bitcoin (BTC), according to fresh on-chain data from analytics platform CryptoQuant. After hitting a five-year low in the ETH/BTC ratio, the second-largest cryptocurrency by market cap has surged 38% in just one week—sparking speculation that a long-anticipated "alt season" could finally be underway.
Ethereum may have hit bottom vs Bitcoin.
The ETH/BTC ratio just surged 38% from a 5-year low. Demand is rising, selling pressure is falling, and ETFs are loading up.
This could signal the beginning of an Alt season.
This sharp rebound isn’t happening in isolation. It follows a period of extreme undervaluation, declining exchange outflows, and rising institutional interest—all of which have historically preceded major rallies in Ethereum’s price relative to Bitcoin.
Understanding the ETH/BTC Ratio: A Key Market Signal
The ETH/BTC price ratio measures how much Ethereum is worth in terms of Bitcoin. When this ratio rises, it means Ethereum is outperforming Bitcoin; when it falls, Bitcoin is leading the market.
Recently, the ETH/BTC ratio dropped to its lowest point since early 2020—just before Ethereum kicked off a massive bull run that saw it gain over 1,000% in value within 18 months. Now, with the ratio bouncing back sharply, many analysts believe history could be repeating itself.
CryptoQuant highlights that Ethereum has now entered an extreme undervaluation zone based on the ETH/BTC MVRV (Market Value to Realized Value) metric—the first such signal since 2019. This indicator compares the current market value of ETH against BTC to its historically adjusted cost basis, helping identify potential market bottoms.
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Past occurrences of similar MVRV readings in 2017, 2018, and 2019 were followed by strong mean-reversion rallies, where Ethereum significantly outperformed Bitcoin over the subsequent months. If those patterns hold, investors could see sustained momentum in ETH’s favor well into 2025.
Rising Spot Trading Volume: Market Sentiment Shifts to ETH
One of the clearest signs of growing bullish sentiment is the surge in spot trading activity. The ETH-to-BTC spot trading volume ratio has climbed to 0.89—the highest level since August 2024.
This means traders are increasingly exchanging Bitcoin for Ethereum on spot markets, signaling a shift in capital allocation toward altcoins. Notably, a similar spike between 2019 and 2021 preceded a period where Ethereum outperformed Bitcoin by nearly fourfold.
Such volume shifts often act as leading indicators for broader market rotation. As confidence in Ethereum’s fundamentals grows—fueled by improvements in scalability, staking yields, and ecosystem innovation—more investors appear willing to take profits on BTC and reinvest in ETH.
Institutional Appetite for Ethereum Is Growing
Beyond retail sentiment, institutional demand appears to be tilting toward Ethereum. According to CryptoQuant, the ETF holdings ratio of ETH relative to BTC has seen a sharp increase since late April 2025.
This suggests that asset managers and institutional funds are allocating more capital to Ethereum-based ETFs compared to their Bitcoin counterparts. Possible drivers include:
- Upgraded network efficiency via proto-danksharding and future full danksharding implementations
- Stronger yield opportunities through staking and liquid staking derivatives
- Regulatory clarity improving investor confidence ahead of potential spot ETH ETF approvals in key markets
With Ethereum continuing to serve as the backbone of decentralized finance (DeFi), non-fungible tokens (NFTs), and real-world asset tokenization, institutions may view it not just as digital gold—but as digital infrastructure.
Declining Exchange Inflows Signal Reduced Selling Pressure
Another critical bullish signal comes from exchange inflow data. The ETH/BTC exchange inflow ratio has dropped to its lowest level since 2020, indicating that fewer ETH holders are sending coins to exchanges—where assets are typically sold.
In contrast, Bitcoin has seen relatively higher inflows, suggesting some profit-taking or redistribution among BTC holders.
When fewer people are looking to sell an asset while demand increases, price appreciation becomes more likely. This confluence of falling selling pressure and rising demand creates ideal conditions for a sustained rally.
CryptoQuant interprets this as evidence that long-term holders are accumulating ETH, possibly anticipating future upside once macroeconomic conditions stabilize and on-chain activity accelerates.
Could This Be the Start of Alt Season?
Many in the crypto community watch Ethereum’s performance closely because it often acts as a bellwether for the broader altcoin market. When ETH begins to outperform BTC consistently, it frequently triggers a wave of capital rotation into other high-potential altcoins.
Key core keywords identified from this analysis include:
- Ethereum undervaluation
- ETH/BTC ratio
- Alt season
- On-chain analysis
- CryptoQuant data
- Institutional ETF flows
- Exchange inflow ratio
- Spot trading volume
These signals—when combined—paint a compelling picture: Ethereum may have reached a generational buying opportunity relative to Bitcoin.
Historical precedent supports this view. Each time the ETH/BTC ratio bottomed near these levels, it was followed by explosive growth in both absolute terms and relative dominance.
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Frequently Asked Questions (FAQ)
Q: What does the ETH/BTC ratio tell us?
A: The ETH/BTC ratio shows how much Ethereum is worth in terms of Bitcoin. A rising ratio means ETH is outperforming BTC, often signaling growing confidence in altcoins.
Q: Why is Ethereum considered undervalued right now?
A: Based on the ETH/BTC MVRV metric, Ethereum is trading below its fair value compared to historical averages—marking its most extreme undervaluation since 2019.
Q: How reliable is CryptoQuant’s on-chain data?
A: CryptoQuant aggregates real-time blockchain data from exchanges, wallets, and mining pools. Its metrics are widely used by traders and institutions for forecasting market trends.
Q: What triggers an "alt season"?
A: Alt seasons typically begin when capital rotates out of Bitcoin and into major altcoins like Ethereum. Key catalysts include technological upgrades, improved investor sentiment, and strong on-chain fundamentals.
Q: Are ETFs really influencing Ethereum’s price?
A: Yes. Increasing allocations to Ethereum ETFs suggest institutional investors are positioning for long-term growth, especially as regulatory frameworks evolve globally.
Q: Should I buy Ethereum now based on these signals?
A: While past performance doesn’t guarantee future results, current data suggests favorable risk-reward dynamics for ETH relative to BTC. Always conduct your own research and consider portfolio diversification.
With demand rising, selling pressure easing, and institutional adoption accelerating, Ethereum appears poised for a significant phase of outperformance. Whether you're tracking on-chain metrics, trading volume trends, or ETF flows, the data increasingly points in one direction: Ethereum’s moment may finally be here.
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