As the market moves into a new quarter, forecasts around Q2-end targets are starting to build.\u00a0<\/span><\/p>\n To gauge potential direction, however, it\u2019s important to look back. Q1 was bearish, with Bitcoin [BTC] closing down 22.2%, its worst quarterly performance since 2018. <\/span><\/p>\n Ethereum [ETH]<\/a>, meanwhile, ended the quarter down 29.36%, though still an improvement over Q1 2025\u2019s 45.41% losses.<\/span><\/p>\n However, if we take the 2025 cycle as the base case, Ethereum\u2019s 36.48% Q2 rally outperformed Bitcoin<\/a> by roughly 1.2x, highlighting ETH\u2019s stronger rebound. That said, a recent CryptoQuant report suggests this trend may already be unfolding, with March leading the shift.<\/span><\/p>\n During the month, Bitcoin posted a marginal +1.83% gain, while Ethereum advanced +7.12%, indicating a clear rotation of capital. <\/span><\/p>\n Concurrently, Bitcoin\u2019s market cap contracted slightly (-0.43%), whereas Ethereum expanded (+2.97%), reinforcing the narrative of capital shifting toward higher-beta assets.<\/span><\/p>\n Notably, this divergence is further validated in supply-side dynamics.<\/span><\/p>\n Ethereum\u2019s continued exchange outflows, for instance, point to a gradual shift toward long-term holding. In addition, on-chain data further supports this: the Coinbase Premium Gap is improving, signaling early-stage recovery.<\/span><\/p>\n Meanwhile, Ethereum\u2019s active addresses continue trending higher, indicating rising network usage.<\/span><\/p>\n In essence, the ETH\/BTC ratio climbing to 5.15% in March wasn\u2019t a fluke. Instead, it was driven by a mix of rotational flows, tightening supply dynamics, and improving on-chain activity. <\/span><\/p>\n Naturally, this brings us to the key question \u2013 Is the setup now forming for Ethereum to outperform Bitcoin in Q2?<\/span><\/p>\n Ethereum\u2019s strength isn\u2019t always fully captured through short-term technical price action.\u00a0<\/span><\/p>\n Instead, price tends to lag the underlying fundamentals. The logic is simple: In DeFi, increased network activity directly translates into higher demand for ETH. However, this demand isn\u2019t immediately reflected in price action. <\/span><\/p>\n Instead, it accumulates on-chain first before eventually being priced in by the market.<\/span><\/p>\n Looking at the recent CryptoQuant report, Ethereum appears to be moving closer to this phase. As shown in the data, the 7-day SMA of Ethereum\u2019s \u2018Total Transfer Count\u2019 has once again broken above 1.3 million, revisiting levels last seen at the mid-February all-time high.<\/span><\/p>\n For context, a high 7-day SMA of \u2018Total Transfer Count\u2019 typically signals elevated on-chain activity, reflecting stronger usage across transfers, trading, and DeFi interactions. <\/span><\/p>\n![\"bitcoins](\"https:\/\/ambcrypto.com\/wp-content\/uploads\/2026\/04\/ETHBTC_2026-04-11_14-34-55.png\")
<\/a>Bitcoins Institutional flows starting to catch up to Ethereum fundamentals<\/b><\/h2>\n
![\"bitcoins](\"https:\/\/ambcrypto.com\/wp-content\/uploads\/2026\/04\/1-2-1.png\")
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