Ether Shows Undervaluation as ETF Demand Increases According to CryptoQuant
Ethereum (ETH) is currently undervalued compared to Bitcoin (BTC), with the ETH/BTC Market Value to Realized Value (MVRV) metric indicating a rare ratio not seen since 2019. Key points include:
- Historically low MVRV levels have led to significant gains for ETH, often outperforming BTC.
- Demand for ETH ETFs has increased, with ETH/BTC ETF holdings rising sharply since late April.
- The ETH/BTC price ratio has rebounded by 38% from its lowest point since January 2020.
- On-chain data shows ETH spot trading volume relative to BTC reached its highest level since August 2024, indicating strong investor interest.
- ETH exchange deposits are at their lowest level since 2020, signaling reduced selling pressure.
- Institutional investors expect ETH to outperform BTC due to recent upgrades and favorable market conditions.
- Confirmation of upward movement requires ETH to break above its key 365-day moving average against BTC.
- ETH still faces challenges with network activity, which may hinder price growth if user engagement does not increase.