Key takeaways
Why is the ETH MVRV divergence important?
The MVRV divergence shows where the conviction lies. ETH stakers have higher unrealized profits, which incentivizes long-term positioning.
What does the shift towards staking mean for Ethereum?
With almost 30% of supply locked, Ethereum appears to be moving from a trading phase to an accumulation cycle.
Stability in a choppy market is the true test of strength.
In particular, Ethereum [ETH] has proven exactly that. Since the drop, it has tested the $3,680 support four times, each time bouncing about 17%. In essence, investor conviction remains strong while buyers remain on the defensive.
CryptoQuantum data adds context to this strength. Since July, a clear gap has opened up in ETH’s MVRV ratio between participants and the circulating supply. Before then, both were around 1.5, showing around 50% unrealized gains.
Source: CryptoQuant
However, since then, the two groups have clearly begun to diverge.
At the close of this edition, the MVRV for ETH in circulation stands at 1.5, while staked ETH stands at 1.7. This suggests that stakeholders have about 20% more unrealized gains, forming a “healthy” 10-20% gap between the two.
From the market’s point of view, it shows where the true conviction lies.
Staked ETH holders are locking in a long-term profit, while liquid tokens face a higher risk of profit-taking. Structurally, this makes staking (with almost 70% in unrealized profits) a standout play in the current Ethereum cycle.
ETH Profits Declining Points to Market Reset
As mentioned above, Ethereum’s circulating supply, MVRV, stood at 1.5.
However, this is a clear drop from the late August high of 1.85, when ETH hit its all-time high of $4,900. Simply put, the MVRV cooldown shows that around 35% of unrealized gains have been wiped out as STHs made profits.
This compression of profit margins indicates that the market is entering a cooling phase. Historically, MVRV levels below 1.0 have marked solid accumulation zones, showing that ETH is slowly resetting for its next leg.
Source: CryptoQuant
However, tying this into the above analysis, there is more to the story.
Reduced profits and increased staking conviction are reducing the MVRV spread between staked and circulating ETH. with more 36 million ETH lockedThis could mark the first stage of a broader structural rotation.
Simply put, Ethereum appears to be moving from a trading phase to an accumulation cycle. As stakes increase, ETH’s base strengthens, preparing for a breakout driven by real conviction, not just hype.
