Binance ETH reserves have declined from nearly 5 million in mid-2025 to about 3.8 million, reducing potential selling pressure and improving the asset’s risk profile.

On-chain and valuation metrics show ETH underperforming Bitcoin overall, with ETH/BTC valuations and deposit activity implying incomplete bottoming and potential downside risk before a sustained reversal.

CryptoQuant notes ETH trading near $1,900 with the realized price around $2,304, placing ETH in the lower half of its realized price band—a historically bottoming zone with upside potential.

The ETH/BTC inflow ratio sits near 0.8, down from above 1.5 last August, with previous bottoms around 0.4, suggesting improving ETH strength relative to Bitcoin.

July saw renewed bearishness among Ethereum traders, with Santiment’s sentiment index at 1.089 on July 24, marking the third bearish extreme in the month.

Past troughs around late June and mid-July historically preceded rebounds, with ETH gaining about 14% over seven days and 7% over the following four days.

The ETH/BTC ratio rose above 0.030 for the first time in three months, signaling a widening relative strength for Ethereum before easing to around 0.0296.

Analysts point to shrinking Binance reserves, improving on-chain metrics, and renewed institutional interest as signs of diminishing downside risk and potential ETH outperformance against Bitcoin.

July was the strongest month so far this year for US spot Ethereum ETFs, with net inflows of about $365 million, outpacing Bitcoin ETFs which drew roughly $172 million as institutional demand picked up.

In the week ending July 24, Ethereum spot ETFs saw inflows of about $103.9 million, marking the third consecutive positive week and underscoring persistent institutional interest despite mixed sentiment.

Ethereum outpaced Bitcoin in July with a roughly 19% gain, climbing to around $1,970 before settling near $1,868, while Bitcoin rose about 8% and failed to break $65,000.

Bearish sentiment alone isn’t a reversal signal, but contrarian setups can emerge when sentiment is negative while ETF inflows, Layer 2 activity, and protocol upgrades remain supportive.