How Ethereum’s 20% MVRV gap could fuel ETH’s next breakout

Key Takeaways

Why does ETH MVRV divergence matter?

The MVRV divergence shows where conviction lies. ETH stakers are sitting on higher unrealized gains, incentivizing long-term positioning.

What does the shift toward staking mean for Ethereum?

With nearly 30% of supply locked, Ethereum appears to be transitioning from a trading phase into an accumulation cycle.

Stability in a choppy market is the real test of strength.

Notably, Ethereum [ETH] has shown exactly that. Since the crash, it’s tested the $3,680 support four times, each time bouncing roughly 17%. In essence, investor conviction is holding firm as buyers stay defensive.

CryptoQuant data adds context to this strength. Since July, a clear gap has opened in ETH’s MVRV ratio between stakers and the circulating supply. Before that date, both sat around 1.5, showing about 50% unrealized gains.

Source: CryptoQuant

However, since then, the two groups have clearly started to diverge.

As of press time, the MVRV for circulating ETH stands at 1.5, while staked ETH sits at 1.7. This suggests that stakers are sitting on roughly 20% more unrealized profit, forming a “healthy” 10-20% gap between the two.

From a market view, it shows where real conviction sits. 

Staked ETH holders are locking in for long-term upside, while liquid tokens face higher profit-taking risk. Structurally, this makes staking (with nearly 70% in unrealized gains) a standout play in Ethereum’s current cycle.

ETH’s shrinking profits point to a market reset

As mentioned above, Ethereum’s circulating supply MVRV sat at 1.5.

However, that’s a clear drop from the late-August peak of 1.85, when ETH hit its $4,900 all-time high. Simply put, MVRV cooling-off shows around 35% of unrealized gains have been flushed out as STHs took profits.

This compression in profit margins signals 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 back to the earlier analysis, there’s more to the story.

Shrinking profits and rising staking conviction are tightening the MVRV spread between staked and circulating ETH. With over 36 million ETH locked, this could mark the early stage of a broader structural rotation.

Simply put, Ethereum looks to be rotating from a trading phase into an accumulation cycle. As staking builds, ETH’s foundation is getting stronger, setting up for a breakout driven by real conviction, not just hype.