Over the past two years, Ethereum (ETH) has witnessed a consistent erosion of its market dominance, implying a shift in investor focus.
Investors are increasingly diverting their capital from ETH towards Bitcoin and select alternative cryptocurrencies like Solana and XRP.
This recalibration of investment, however, is perceived by market analysts as a significant opportunity.
Many within the field posit that the current landscape presents a unique and potentially lucrative moment to increase holdings of ETH.
The central question arises: Does this five-year low in Ethereum’s dominance truly represent a strategically advantageous entry point for investors?
Ethereum’s Dominance Metric Reaches a Concerning Depth
According to insights from analyst Rekt Capital, Ethereum’s dominance metric (ETH.D) has experienced a substantial contraction.
It has receded from 20% in June of 2023 to approximately 7.3% at the time of this analysis, having briefly touched 8% in 2025.
ETH.D, defined as the percentage of Ethereum’s market capitalization of the total market capitalization of all cryptocurrencies, underscores a diminishing level of investor interest in ETH, both when viewed against its historical performance and in comparison to the broader digital asset market.
Historical Trend Suggests Potential Rebound from Support Zone
Rekt Capital’s analysis incorporates a visual chart indicating ETH.D’s interaction with a designated “green support zone.”
Historically, Ethereum has shown a tendency to reverse course and regain market strength after reaching this specific zone.
This historical pattern prompts a critical inquiry, posed by Rekt Capital: Can Ethereum replicate its past behavior and recapture market dominance? The analyst suggests that such a recurrence would constitute a compelling “buy” signal for investors.
“Is Ethereum capable of repeating history?” Rekt Capital asks, highlighting the established precedent of market dominance recoveries initiated from this identified support area.
Significant “Whale” Sales Introduce Cautionary Note
Countering this bullish sentiment, a recent analysis from BeInCrypto introduces a note of caution by pointing to ongoing selling activity from major Ethereum holders, often referred to as “whale addresses.”
Data indicates that entities possessing between 100,000 and 1 million ETH have divested approximately 1.19 million ETH within a single week, translating to a value exceeding $1.8 billion.
These substantial sales are actively exacerbating the downward pressure on ETH’s price and further diminishing its overall market dominance.
Percentage of Profitable ETH Supply Falls to Levels Seen During Previous Bear Market
Expanding beyond the issue of declining dominance, data from Glassnode highlights another concerning metric: the proportion of the total ETH supply that is currently held at a profit has decreased to a four-year low point.
Currently, only 40% of the circulating ETH supply is in a profitable position, a stark contrast to the 97.5% profitability observed in early December of 2024.
Analyst Venturefounder stresses the importance of this metric, indicating that should the “supply in profit” percentage fall below 30%, it would signify a rare buying opportunity, an event that has occurred only infrequently over the last decade.
“The percentage of ETH supply showing profit (currently at 40%) is now lower than what was observed at the lowest point of the last bear market cycle (42%), when ETH was priced at $800.
On-chain indicators are already suggesting that the time to deploy capital is now,” Venturefounder argues, underscoring the magnitude of the current market correction.
Also Read: Ethereum Surpasses Bitcoin as Global On-Chain Settlement Layer, Analyst Claims
