Crypto analyst Joao Wedson said Ethereum has entered a historically significant valuation zone. Wedson noted that the simultaneous decline of two key long-term indicators to negative levels could signal undervaluation and an accumulation period for ETH.
Wedson noted that Ethereum’s MVRV Z-Score indicator has fallen to -0.14, indicating that ETH is trading at a suppressed valuation compared to its actual value. According to the analyst, periods when the MVRV Z-Score fell to negative levels in the past were mostly associated with intense market stress and valuations that were attractive for long-term investment.
Another indicator highlighted by Wedson, the Delta Growth Rate, has fallen to minus 0.07. This metric compares market capitalization growth with actual value growth over a 365-day average.
A negative trend in the indicator suggests that realized value is growing more strongly than market value. According to Wedson, this indicates that on-chain value accumulation is outpacing speculative price increases.
“The valuation structure for Ethereum is becoming increasingly attractive”
Noting that both indicators were simultaneously in negative territory, Wedson said that in the past, similar conditions were more associated with periods of accumulation and undervaluation than with market euphoria.
The analyst added that this doesn’t mean Ethereum has reached its absolute bottom, stating that despite the weakness in prices, ETH’s valuation structure is becoming increasingly attractive.
Wedson said the market was still trending downwards, but fundamental valuation indicators were beginning to paint a different picture.
