Ethereum's performance lags behind bitcoin's surge, but analysts indicate that Ethereum has significant upside potential based on key indicators.

So far, Ethereum [ETH] has been unable to keep up with the continuous rise of Bitcoin [BTC].

Despite Bitcoin hitting historic highs in recent weeks, Ethereum has dropped 36.2% from its 2021 all-time high of $4,878.

As of the time of writing this article, ETH is trading at $3,111, down 0.6% in the past day and around 1% in the past week. This performance difference has raised doubts about whether Ethereum can catch up with Bitcoin.

Despite the lackluster performance, some market analysts remain optimistic about Ethereum's potential.

One analyst, Ali, recently expressed a positive stance on social media, predicting that ETH's performance will soon surpass that of Bitcoin.

Ali's confidence is based on multiple indicators, including the 'Altcoin Season Indicator'.

He mentioned that historically, each market cycle will go through a phase where ethereum surpasses bitcoin, but this has not happened in the current cycle yet. Ali believes this is a potential buying opportunity.

What are the factors driving the rise of ethereum?

Ali also emphasized that the MVRV (market value to realized value) indicator is an important indicator to measure the future performance of ethereum.

The MVRV indicator measures the ratio between the market value and realized value of assets, providing insights into whether the asset is overvalued or undervalued.

Ali pointed out that historically, when ethereum's MVRV momentum crosses its 180-day moving average (MA), it indicates a period of excellent performance for this cryptocurrency.

Despite ethereum's recent price increase from $2,400 to $2,800, this crossover has not occurred yet, indicating further potential for an increase.

In addition to the MVRV indicator, Ali also mentioned that there has been an increase in inflow of ETH spot ETF. He explained that investors have shifted from allocation to accumulation, with the ETH spot ETF accumulating over 0.147 billion US dollars' worth of ETH.

Furthermore, it has been reported that ethereum whales have purchased over $1.4 billion worth of ETH, further supporting Ali's bullish outlook.

According to Ali, the potential price trend of ethereum may involve testing resistance levels of $4,000 and $6,000. If ethereum follows the price trend of the S&P 500 index, the bullish scenario is expected to reach a target price of up to $10,000.

Reviewing the market position.

While Ali's analysis provides a positive outlook for ETH, studying key indicators can further understand whether ethereum can truly surpass bitcoin.

One of these indicators is the estimated leverage ratio, which reflects the level of leverage used by derivatives market traders.

High leverage ratios typically mean increased risk and potential volatility, while decreasing leverage ratios may indicate reduced speculation.

According to CryptoQuant's data, ethereum's estimated leverage ratio dropped to 0.40 on November 19th, after peaking at 0.430 earlier this month.

This decline may indicate a reduction in speculative activity, potentially paving the way for more stable growth.

Coinglass data further shows that the open interest in ethereum decreased by 0.09%, currently valued at $17.88 billion.

In addition, the open interest in ETH decreased by 30%, currently at $31.1 billion.

These trends may indicate that ETH is in a consolidation phase, with reduced market activity, posing challenges and opportunities for future growth.