The deviation between Bitcoin (BTC) and Ethereum (ETH) price action has continued to widen in the recent past amid the ongoing mainstream adoption of digital assets and web3 protocols. The historical correlation between Bitcoin’s bull rally and the altseason has continued to grow negatively due to the extreme dilution of liquidity by thousands of new altcoins in the market.
The approval of spot Bitcoin ETFs and spot ETH ETFs in the United States last year has made it more difficult for the crypto cash rotation to thrive akin to previous macro bull markets. As a result, the next altcoin season, led by Ethereum, will be fueled by new cash inflows to projects with better fundamentals and prospects of real-world utility.
Ethereum Whales Remain Timid in the Short Term
Since the beginning of 2025, the overall supply of Ether on centralized exchanges has increased from 15.39 million to about 16.04 million at the time of this writing. The notable increase in Ether supply on CEXes has continued to weigh down on bullish sentiment.
Furthermore, the overall cash flow to the US spot Ether ETFs has continued to shrink in the past few weeks. Since the beginning of this week, the US spot Ether ETFs have registered a net cash outflow of about $141 million.
According to on-chain data analysis by Glassnode, long-term Ether investors have started to feel anxious after depicting belief and denial in the last three months.
What’s Next for ETH?
As Bitcoin dominance continues to gain more ground against the majority of the altcoins, crypto analyst Benjamin Cowen has predicted a major downturn for Ether before a bullish recovery in the near future. Moreover, Cowen noted that the Federal Reserve did not kick start its Quantitative Easing (QE) program akin to the Canadian counterpart.
From a technical analysis standpoint, crypto analyst Ali Martinez highlighted that the key support zone for Ether is between $2,230 and $2,610, bolstered by nearly 12 million wallets accumulated over 62 million ETH.
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