Bitcoin is still hovering near record territory. Even so, this may be the moment for investors to rotate into Ethereum.
Bitcoin’s Rally May Be Near the Finish Line
Three years ago, Bitcoin traded roughly 100,000 dollars lower than today. Since the 2022 bear-market low, BTC has risen about 700%. A 5,000 euro stake back then could be worth around 40,000 euros now.
If history rhymes, this bull market is late-cycle. We’re 16 months past the April 2024 halving; prior cycles often peaked about 18 months afterward before a bear market took over. In past downcycles, drawdowns of 70%+ have not been unusual. That gives investors solid reasons to take profits in BTC and rotate ahead of the final blow-off — with Ethereum as the prime candidate.
Ethereum Hasn’t Printed New Highs Yet
BTC has already exceeded its 2021 peak by ~80%. ETH hasn’t. The all-time high near 4,867 dollars (November 10, 2021) still stands, even if current prices around 4,300 dollars are closing in.
In the last cycle, ETH beat its prior peak (1,420 dollars in 2018) by roughly 240%. A similar extension today would place ETH well above 10,000 dollars. Even with more conservative, diminishing-returns assumptions, the entry still looks attractive relative to potential upside.
Altcoin Season Looks Close
Most altcoins haven’t kept pace with BTC’s surge. Ethereum is one of many majors still pressing into old resistance. That underperformance can be an opportunity: historically (2017/2018, 2020/2021), a powerful altseason has followed Bitcoin’s strong phase, with parabolic moves where alts outperform BTC.
The data underscore the room to run: the altcoin market cap jumped ~65,000% from Jan 2017 to Jan 2018 (from a tiny base) and ~4,300% in 2020/2021. In the current cycle, alt mcap is “only” up ~230% from the 2022 low and hasn’t yet reclaimed the 2021 peak near 1.71 trillion dollars — a backdrop that favors ETH exposure here.
BTC Dominance Is Rolling Over
Since September 2022, BTC’s dominance climbed from ~39% to as high as ~66%, and ETH lagged on a relative basis. Lately, that trend has started to turn: after bottoming in April 2025, ETH’s value versus BTC has recovered to ~13%, while BTC dominance has faded to ~60%.
Technicians see scope for a bullish double-bottom (W-pattern) in ETH/BTC. If ETH’s market share pushes back toward 20% versus Bitcoin — and potentially beyond — it would mark a decisive momentum shift in favor of Ethereum and the broader alt sector.
Institutions Are Discovering Ethereum
Spot BTC ETFs (launched January 2024) unlocked massive institutional demand, with products like BlackRock’s racing past 80 billion dollars AUM. Spot ETH ETFs (approved May 2024) initially trailed.
That’s changing. In July 2025 alone, spot ETH ETFs pulled in roughly 5 billion dollars — a monthly record — and now manage well over 20 billion dollars combined. On some days, ETH ETF inflows have already topped BTC’s. The acceptance curve among large allocators is steepening, yet price impact has been modest so far — a tell for latent upside.
Exchange Supply of ETH Is Shrinking
Beyond price, supply dynamics matter. On-chain data show a persistent drain of ETH from centralized exchanges to self-custody. CryptoQuant estimates only ~15% of circulating ETH now sits on major venues like Binance and Coinbase. Since early 2025, exchange balances reportedly fell by ~1.6 million ETH to ~18.9 million — a historic low.
Coins moving off exchanges are typically long-term holdings, reducing readily sellable supply. If this trend persists into rising demand, basic market mechanics favor higher prices.
Ethereum’s Technological Edge
Bitcoin set the standard for decentralized money and scarcity (21 million cap), earning unrivaled brand strength. But Ethereum has the broader programmable platform: thousands of decentralized applications run as smart contracts on ETH, making it the default settlement layer for tokenized assets, DeFi, NFTs, and beyond.
The 2022 switch to Proof of Stake made Ethereum more energy-efficient and responsive, with staking yields incentivizing capital to secure the network. For builders and enterprises, ETH’s flexibility and developer ecosystem are compelling. Long term, that utility can compound value — and test whether BTC’s store-of-value role alone sustains its lead.--
Bottom Line
These seven reasons sketch out why rotating into ETH at today’s levels — still below four-year-old records — could be a timely move for investors looking beyond Bitcoin’s late-cycle strength.
Editorial note: The price views in this article are not investment advice. They reflect the author’s assessment only.
