Ethereum's Market Value Realized Value (MVRV) has gained attention lately, especially compared to Bitcoin. Ki Young Ju, CEO of CryptoQuant, notes that Ethereum’s rising MVRV is accompanied by increasing on-chain activity, suggesting it may not be overvalued despite the uptick.
Understanding MVRV
MVRV determines if an asset is trading above or below its fair price. It represents the difference between the price users paid for the asset and its current market price. A high MVRV indicates that the market value of Ether is higher than its realized value, signaling potential overvaluation and a risk of sell-off. Conversely, a declining MVRV suggests the market is cooling down and the price may be approaching its fair value.
Ethereum vs. Bitcoin: MVRV Trends
Ethereum MVRV ratio chart. Source: Santiment
Over the past 30 days, Ethereum’s MVRV surged by 29.9% to reach 91.43%, while Bitcoin’s MVRV decreased by 10.8% to 127.41%, according to Santiment data. This rise in Ethereum’s MVRV compared to Bitcoin's decline highlights the growing interest in Ethereum.
On-Chain Activity and Investor Sentimen
Ki Young Ju pointed out that the rise in Ethereum’s MVRV is reflected in increased transaction volume and active addresses on the Ethereum network. This suggests the asset is not overvalued despite the rising MVRV. With spot Ether ETFs expected to start trading soon, Ju believes the high MVRV will not deter investors.
SEC Chair Gary Gensler mentioned ETF trading would begin “over the course of this summer,” and ETF analyst Eric Balchunas suggested it could start as early as July 2.
Ether's Price Prediction: Heading to $10,000?
Pseudonymous crypto analyst Yoddha highlighted Ethereum’s price position on the chart, noting slight consolidation following a morning star formation, which signals a bullish reversal from a downtrend.
Yoddha expressed optimism about Ethereum’s price, predicting it will surpass $10,000 by the end of 2024.
“Ethereum is holding up the price pretty well and looks ready to go bonkers,” Yoddha wrote on June 19. “It will be above $10,000 before the end of the year. Mark my words.”
While Ethereum’s rising MVRV suggests a heating market, increasing on-chain activity levels indicate it may not be overvalued. With the expected introduction of Ether ETFs, investor interest remains strong. Analysts like Yoddha are optimistic about Ethereum’s future, forecasting significant price growth by the end of 2024.
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