What does a 20% MVRV distance indicate about Ethereum's upcoming breakout potential?

The stability amid the turbulent waves is the true measure of strength.

And Ethereum (ETH) is clearly proving that. Since the sharp decline, ETH has tested the support level of 3,680 USD four times — and each time it has bounced back by about 17%. This shows that investor confidence remains strong, as the buying pressure maintains a defensive stance.

Data from CryptoQuant further supports that argument. Since July, the MVRV ratio of ETH between the two groups — staking investors and circulating supply — has begun to clearly diverge. Previously, both were around 1.5, corresponding to unrealized profits of about 50%.

Source: CryptoQuantHowever, this divergence is becoming increasingly evident. As of now, the MVRV of circulating ETH is still around 1.5, while the MVRV of staking ETH has risen to 1.7. This means that the staking investor group is holding a higher unrealized profit of about 20%, creating a “healthy” gap of 10–20% between the two groups.

From a market perspective, this is where true trust is really concentrated.

Those who hold ETH staking choose to lock up their capital, demonstrating a long-term vision and belief in the next growth cycle. In contrast, the circulating amount of ETH is more susceptible to early profit-taking. Structurally, staking activity — with unrealized profits nearing 70% — is becoming the most prominent highlight in the current cycle of Ethereum.

Shrinking profits indicate that the market is “rebalancing”

As mentioned, the MVRV index of the circulating supply of ETH is currently at 1.5 — a significant decrease from the peak of 1.85 reached at the end of August, when ETH approached the $4,900 mark. In other words, the “cooling off” of MVRV indicates that about 35% of unrealized profits have been absorbed as short-term investors take profits.

The narrowing profit margin is a signal that the market is entering a phase of adjustment and accumulation. History has shown that whenever MVRV drops below 1.0, it is usually a strong accumulation zone — a period when ETH quietly rebuilds its foundation before opening up a new growth cycle.

![MVRV-eth](https://img-cdn.gateio.im/webp-social/moments-112dbdc041c69e11d0de898a778956a2.webp01Source: CryptoQuantHowever, when placed in the broader context, the data reveals a deeper movement.

The decline in profitability alongside the increasing confidence from the staking investor group is causing the MVRV gap between ETH staking and circulating ETH to gradually narrow. With over 36 million ETH being locked, this could very well be the starting phase for a larger restructuring cycle of the network.

In summary, Ethereum seems to be transitioning from the trading phase to the accumulation phase. As staking activity continues to expand, the foundation of ETH is becoming increasingly solid — setting the stage for a breakout based on genuine confidence, not just temporary waves of FOMO.

SN_Nour