The ETH/BTC ratio has fallen ~8% in two weeks as spot flows diverge: Bitcoin spot demand is densifying while Ethereum liquidity thins, signaling a potential structural rotation back into BTC driven by on-chain whale repositioning and concentrated spot buying.
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ETH/BTC down ~8% in two weeks, largest consecutive drop since April.
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On-chain data shows a large ETH holder’s 886k ETH now converts to ~34k BTC, implying a $177M paper loss versus prior deployment.
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Glassnode cost-basis distribution: BTC spot flows are dense; ETH shows supply gaps—spot-driven BTC strength vs derivatives-driven ETH.
ETH/BTC ratio drops 8% as spot flows diverge; Bitcoin rotation accelerates. Read on-chain analysis, Glassnode signals, whale moves and what traders should watch next.
What is causing the ETH/BTC ratio to fall?
The ETH/BTC ratio is falling because Bitcoin spot demand has outpaced Ethereum, creating a net rotation from ETH into BTC. Short-term on-chain data and dominance metrics show concentrated BTC spot accumulation while ETH sees thinner spot depth and more derivatives pressure.
How are spot flows driving the rotation?
Spot flows are the clearest signal: Cost Basis Distribution indicates BTC spot buy-side demand is stacked and dense, creating price support. Ethereum’s spot distribution shows air gaps, meaning price moves rely more on derivatives and liquidations. Glassnode data and exchange flow reports corroborate a structural divergence in spot liquidity.
There’s a subtle rotation playing out under the hood. The ETH/BTC ratio ran into resistance around 0.043 on 2025-08-18 and has retraced, dropping nearly 8% in two weeks — the largest back-to-back fall since the April FUD.
That suggests recent BTC-to-ETH flows are starting to unwind. On-chain tracking shows a major ETH accumulation that bought 886k ETH would now receive roughly 34k BTC if swapped — down from about 36k BTC originally.
Source: TradingView (ETH/BTC)
Simply put, the investor faces roughly a $177 million unrealized loss on this rotation. As BTC outperformed ETH, swapping 886k ETH now nets ~34k BTC instead of the ~36k BTC initially deployed.
The core takeaway: Bitcoin’s on-chain momentum is currently outpacing Ethereum’s. The main question is whether whales will keep rotating into BTC or if ETH can rebuild spot depth to reassert relative strength.
Spot flows diverge: BTC dense, ETH sparse
Bitcoin dominance (BTC.D) briefly bounced in mid-July but then slid through August, retesting ~57% — a level not seen since Q1. Ethereum dominance (ETH.D) surged into the July–August cycle before flipping into a 7% pullback in two weeks.
That pattern shows smart money took profits into ETH’s run, then began stepping back into BTC as ETH’s upside became constrained by thin spot liquidity.
Glassnode’s Cost Basis Distribution highlights the divergence: BTC spot flows appear stacked and anchored, supporting upward pressure. ETH shows gaps in spot concentration, suggesting price moves are more susceptible to derivatives unwinds and liquidations.
Source: TradingView (ETH.D)
Frequently Asked Questions
Why did the ETH/BTC ratio drop suddenly?
The ratio fell as BTC spot accumulation outpaced ETH spot demand. Large ETH holders faced reduced BTC conversion power and smart money rotated into BTC given denser cost-basis support on-chain (Glassnode data referenced as context).
How can traders monitor rotation between ETH and BTC?
Track ETH/BTC ratio, cost-basis distribution, exchange flows and BTC.D/ETH.D dominance. Watch large wallet transfers and on-chain metrics for spot accumulation versus derivatives positioning to time potential rotation entries.
Is this a structural long-term rotation into Bitcoin?
Current signals suggest a structural divergence driven by spot liquidity, but long-term outcome depends on sustained BTC spot demand, ETH spot rebuilding, and macro flows. Monitor on-chain concentration and institutional spot buying for confirmation.
Key Takeaways
- ETH/BTC down ~8%: Largest consecutive drop since April; signals a short-term trend shift.
- Spot depth matters: BTC shows dense spot demand; ETH displays gaps and derivatives sensitivity.
- Actionable insight: Traders should watch cost-basis distribution, whale moves and BTC.D/ETH.D to gauge rotation continuation.
Conclusion
The ETH/BTC ratio decline reflects a tangible rotation: spot flows are favoring Bitcoin while Ethereum liquidity thins, creating tactical opportunities and risks for traders. Monitor on-chain metrics, dominance indicators and large-holder behavior as the next mover could confirm whether this is a sustained structural rotation into BTC. COINOTAG will continue tracking updates and on-chain signals.
