Market indicators are suggesting a positive outlook amidst the crypto community for Ethereum
In a significant shift in the cryptocurrency market, Ethereum (ETH) has surpassed Bitcoin (BTC) in terms of long-term holder growth, according to a chart posted on Twitter by analysts at IntoTheBlock. This trend was primarily driven by rising institutional demand for Ethereum, fuelled by growing interest in Ethereum ETFs and its staking potential, alongside supportive regulatory developments and stronger investor sentiment towards ETH relative to BTC.
Key contributing factors to this shift include institutional inflows and staking, price performance and market sentiment, regulatory clarity, and changing market participation.
Institutional investors significantly increased their Ethereum holdings by about 68% from December 2024 to mid-2025, reaching roughly 6.1 million ETH. This surge was driven by demand for regulated Ethereum ETFs and the staking rewards Ethereum offers, attracting long-term investors who prefer yield-generating assets.
Ethereum's price neared its all-time high ($4,774), with its ETH/BTC ratio peaking at levels not seen in months, reflecting growing strength and investor preference for ETH. This relative outperformance contributed to positive investor sentiment and more confident accumulation by long-term holders.
Proposed U.S. legislation (CLARITY Act) aiming to classify Ethereum and Bitcoin as commodities could reduce uncertainty, encouraging institutional adoption of Ethereum assets. In contrast, Bitcoin long-term holders began shifting from accumulation to distribution around mid-2025, offloading some positions after historic gains near all-time highs ($123,000).
The chart illustrates the percentage of long-term Bitcoin and Ether holders over the past year. According to data from CoinGecko, Ethereum's price rose by 48.2% between the beginning of the year and December 2024, while Bitcoin's price increased by over 122%. Despite this, the proportion of Ethereum holders who have held the cryptocurrency for more than a year increased from 59% in January to 75% in December 2024, while the proportion of Bitcoin holders decreased from 70% to 62% during the same period.
Analysts at Kaiko attributed the difference in performance between Bitcoin and Ethereum to a shift in funds to Solana due to high Ethereum network fees and the hype around memecoins in the fourth quarter. The absence of staking in launched ETH-ETFs and their "sluggish" start compared to Bitcoin funds added pressure on Ethereum's performance.
However, Michael van de Poppe, an analyst and founder of MN Trading, believes that Ethereum's strengthening relative to Bitcoin by January will not be surprising. He also suggested that a break above the 0.4 level in the ETH/BTC pair could trigger a rally in altcoins in the Ethereum ecosystem.
Earlier, specialists at CryptoQuant had indicated bullish signals for Ethereum. The chart can be found at pic.twitter.com/F7ghaSq66T. This shift in the cryptocurrency market underscores the growing appeal of Ethereum as an institutional asset and its potential for further growth in the coming months.
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