Ethereum rallies, Bitcoin stalls: Is capital rotation reshaping the crypto landscape?

• Ethereum has surged with force. Meanwhile, Bitcoin’s dominance has reversed sharply.
• Capital rotation appears to be in play.

The race to the top is heating up — and it’s not another altcoin frenzy. Instead, it’s a top-tier face-off between the two largest crypto assets.

Ethereum [ETH] is ripping higher, clocking nearly +50% ROI in under a month, tagging $2,616 at press time. Momentum’s aggressive, and bulls are clearly in control.

Meanwhile, Bitcoin Dominance [BTC.D] has taken a sharp U-turn from its recent 65% high. BTC itself is stalling, delivering muted weekly returns — not what you’d expect at six figures.

Consequently, the rotation narrative is gaining steam. Investors are tactically reallocating, and ETH’s relative strength is impossible to ignore.

Strategically, all eyes are on: Whether ETH can outmuscle BTC in this leg of the cycle.

Tactical tilt in play as capital rotates

Roughly a week ago, Ethereum’s breakout from $1,800 hit a wall. As price wicked into $2,597, AMBCrypto flagged a sharp long liquidity sweep, with 300,000 ETH dumped into strength. 

But the rejection wasn’t a reversal — it was a reset. 

On the 8th of May, Bitcoin Dominance [BTC.D] tapped out at 65.34% before rolling over, dropping 3% in the days that followed.  Meanwhile, Ethereum Dominance [ETH.D] surged 3%, tagging 9.75% — a clean divergence.

Source: TradingView (BTC.D)

The result? ETH bulldozed through the $2,600 supply wall and flipped the level with conviction. In short, it was a textbook case of strategic rotation in motion.

With over 60%+ ROI in just weeks, Ethereum is delivering asymmetric upside. Consequently, investors are rotating aggressively to capture it.

Ethereum front-runs resistance as Bitcoin holds back

Beyond rotational capital, even smart money is capitalizing on Ethereum’s momentum. 

Abraxas Capital, a heavyweight in the game, has been loading up: 242,652 ETH added to the bags over the past week, totaling a massive $561 million. That pegs their average entry at approximately $2,312.

Clearly, a well-calculated strike well below the current spot, putting them on a sizable $76 million+ in unrealized gains.

So, with smart capital and solid bid support aligning, ETH’s primed to break $3k and potentially front-run BTC’s stubborn $106k resistance.

But keep an eye out. This rotational dance can flip on a dime. The ETH/BTC SOPR has flipped above 1 for the first time since the 5th of January.

Hence, signaling fresh profit-taking on the ETH-BTC pair.

Source: Glassnode

Back then, that signal unleashed an 8.3% bearish engulfing candle on ETH, triggering a textbook long liquidity sweep that shook out weak hands and ignited cascading stops.

Bottom line? The battle for crypto dominance is heating up, and Ethereum is dominating — for now.

But the charts make one thing clear: The story is far from over.