CryptoQuant: Ethereum approaches bottom of the Bitcoin market, key signals not yet confirmed

Ethereum's valuation has become more attractive, but on-chain data has not yet confirmed a long-term bottom.

Compared with Bitcoin, Ethereum's valuation prospects are becoming more eye-catching, but on-chain data suggests that the market may not have yet reached a decisive long-term bottom. CryptoQuant's latest weekly analysis points out that Ethereum trading prices are below the key "realized value" benchmark, while several other indicators are improving, but not all have reached the historical turning points seen at previous cyclical lows.

In the report, CryptoQuant stated that the Ethereum price is about 17% lower than its realized price. The realized price is an indicator that reflects the average cost basis of holding Ethereum on the network. The realized value is currently estimated at approximately $2300, a level that historically has generally been consistent with periods of widespread undervaluation and prolonged bottoms. However, CryptoQuant also warned that only some of its indicator system have reached extreme levels that fully confirm the turning point of the cycle.

Core Points

CryptoQuant estimates that the Ethereum transaction price is about 17% lower than its realized price (about $2300), which is an undervaluation area on historical. Of CryptoQuant's five "bottom-building" indicators, two have reached historical reversal levels, while the remaining three are improving, but have not yet reached previous cycle lows. Ethereum is showing signs of stabilization relative to Bitcoin: ETH/BTC spot trading volume has entered a common range near the historical bottom. CryptoQuant pointed out that exchange inflows appear to be cooling, while ETF holdings have begun to recover after months of weakness. As the pledge participation rate increases, Ethereum's circulating supply continues to tighten. According to Staking Rewards data, 34% of the supply has been pledged.

Ethereum is below realized value, but the bottom has not yet been "confirmed"

The core of CryptoQuant's valuation argument is that Ethereum is still trading at a price below the realized price. When market participants trade prices below the average cost of holding positions on the chain, it may indicate capitulation selling, especially if this situation persists. CryptoQuant said that this situation has previously marked an undervalued period and long-term bottom-forming stage for Ethereum. However, the company is cautious to point out that even if there are discounts, a complete bottom-building process usually requires consistent confirmation of multiple chains of signals. In its weekly report, CryptoQuant pointed out that only two of the five bottom-building indicators have reached historical reversal levels. The rest of the indicators are moving in the right direction, but have not yet reached the extreme readings seen at previous cycle lows.

For traders and investors, the practical lesson is that Ethereum's valuation is improving relative to its own history on the chain, but the market's "bottom of the cycle" may still be in shape rather than fully established. This distinction is important because the typical recovery path after a bottom is formed may not be smooth-especially if some indicators have reversed while others are still in transition.

Changes in ETH/BTC: Compared with Bitcoin, trading activity slows down

CryptoQuant also emphasized that Ethereum's posture relative to Bitcoin is improving. The analyst firm pointed out that multiple indicators together suggest that Ethereum may be emerging from its overvalued phase relative to Bitcoin. Among the factors cited: CryptoQuant said that the ratio of market value to realized value of Ethereum has dropped from extremely overvalued areas. It also reported that exchange inflows have fallen and ETF holdings have begun to recover after months of weakness. In addition, the company noted that ETH/BTC spot trading volume has dropped to a range historically associated with market bottoms.

CryptoQuant's historical framework is important because it implies that investors should not only consider price levels, but also the performance of market activities. A decline in relative trading volume may indicate a decrease in speculative hand changes-which is often a feature of the bottom consolidation phase. At the same time, falling trading volumes could also mean that liquidity and volatility conditions are changing, which could affect the speed at which price trends develop once sentiment improves.

CryptoQuant's data also shows that the MVRV ratio of ETH/BTC has dropped significantly from nearly 0.95 in August 2025 to approximately 0.65, indicating that Ethereum has become substantially cheaper compared to Bitcoin. This level of compression is consistent with the market moving away from a relatively overvalued state that could lead to a correction.

Supply dynamics: Exchange outflows, increased pledges, and corporate accumulation

In addition to valuation, CryptoQuant's broader on-chain perspective is consistent with the narrative of tightening supply for Ethereum. A key component is exchange behavior. According to reports, in the week starting June 29, withdrawal activity at Binance, the largest cryptocurrency exchange by volume, rose to its highest level in more than three years. Although exchange outflows are often interpreted as a signal that holders are moving assets to self-custody or pledge rather than leaving them on the exchange ready to be sold, CryptoQuant's framework generally treats these flows as indicative rather than decisive factors. Outflows may be related to long-term holding beliefs, but may also reflect operational transfers or transfers that do not automatically translate into net accumulation.

In terms of pledges, Ethereum's supply seems to be increasingly locked out and away from instant transactions. Quoted Staking Rewards data shows that 34% of Ethereum's circulating supply is now pledged, setting a record high. This is important because higher pledge participation rates reduce the portion of ETH liquidity available for frequent exchange transactions-which could ease short-term selling pressures if demand remains. Corporate accumulation is also part of the supply story. Tom Lee's Bitmine Immersion Technologies (confirmed as the largest corporate ETH holder) reportedly added 325,000 ETH positions to its holdings in a month despite large unrealized losses on its books. The company's stated goal is to hold 5% of the second-largest cryptocurrency total.

Taken together, these factors-reduced ETH on exchanges, more ETH pledged, and increased holdings by large households-create an environment where price increases may face less immediate selling pressure than in purely clearing-driven scenarios. However, tightening supply does not guarantee a bottom, which is why CryptoQuest's multi-indicator approach remains central to its caution.

Price movements and the possibility of macro optimism

CryptoQuant's on-chain caution comes at a time when price movements have shown some strength. The report pointed out that Ethereum briefly rose above $1950 this week, while Bitcoin exceeded $67000, supported by optimism about the US CLARITY Act. The same report also mentioned that market analysts pointed out that funds could be rotated back into cryptocurrencies from overvalued AI stocks-an argument that if realized, could broaden risk appetite and support both Ethereum and Bitcoin.

Even so, the information on the chain is not vaguely "waiting for confirmation"-it is more specific: only two of the five bottom-building indicators have reached historical reversal levels, which means that key extremes still seem to be missing. For market participants, this means that monitoring should focus on whether remaining indicators continue to accelerate towards the prior-cycle low pattern, rather than treating current valuation discounts as the entire basis.

Looking ahead, the main question is whether unidentified indicators can catch up-especially those related to market behavior, such as inflows, valuation extremes and trading volume conditions-while pledges and exchange outflows continue to tighten Ethereum's liquidity supply. If these trends persist, CryptoQuant's "improved but unfinished" framework may shift to a more explicit bottom-up pattern; if they subside, the market may remain in a long consolidation rather than entering a clear rebound.