Ethereum Shows Signs of Bottoming Out as Long-Term Holders Capitulate

Ethereum, the second-largest cryptocurrency by market capitalization, has shown signs of potentially bottoming out, according to recent on-chain data. This development has sparked interest among investors who are closely monitoring the market for opportunities to enter at discounted prices. As of mid-April 2025, Ethereum was trading around $1,590, reflecting a modest recovery from its recent lows.

One of the key indicators suggesting a potential bottom is the capitulation of long-term Ethereum holders. These seasoned investors, who have held their positions through various market cycles, are now selling at a loss. This behavior, known as capitulation, often occurs near market bottoms when emotions peak and prices reflect maximum pessimism. The fact that these experienced investors are exiting their positions suggests that Ethereum may be entering an accumulation zone, where prices are low but the upside potential is high.

Supporting this view is a noticeable increase in on-chain activity. Despite the recent price slump, Ethereum's network has seen a spike in the number of daily active addresses and transactions. This indicates that retail interest in Ethereum is rising, with users continuing to engage with its ecosystem. Typically, rising network activity during a price decline suggests that users are taking advantage of discounted prices and preparing for a longer-term recovery.

Whale movements have also added to this narrative. Over half a million ETH have changed hands among major wallets in just a few days. While some whales appear to be taking profits or rebalancing their portfolios, others are accumulating, taking advantage of lower prices to strengthen their positions. One long-term Ethereum wallet, dormant since 2016, recently sold thousands of ETH during the dip. Interestingly, this wallet only moves during major corrections, which in the past has often marked key market turning points.

Another key indicator is the Market Value to Realized Value (MVRV) ratio, which has dropped to levels typically associated with major market bottoms. When the MVRV falls deep into negative territory, it shows that many investors are holding coins worth less than what they paid—again pointing to a ripe moment for accumulation. Historically, these conditions have set the stage for significant recoveries in price.

In summary, Ethereum may be nearing the end of its latest correction. Long-term holders are capitulating, whales are repositioning, and on-chain data signals growing interest in the platform. While prices may remain volatile in the short term, this period could represent one of the best risk-reward entry points for those looking to invest in ETH for the long run. With the broader crypto market beginning to stabilize, Ethereum might soon lead the next bullish wave.