Where is ETH in the cycle? | Michael Nadeau

Mike Nato and Ryan assess Ethereum's cycle: L2 scaling shifted value capture, stablecoins underpin fair value, and on-chain metrics imply ETH sits in fair—not deep—value.

Key Takeaways

L2 scaling reduced L1 fee capture, causing ETH to “skip” this cycle; a renewed L1-refocus could restore on-chain fee accrual and drive outperformance if executed.
Ethereum hosts ~60% of stablecoins (~$180B+; USDT ~53.6%), creating a base valuation; fair market-cap estimate near $250B versus current ~$180B.
On-chain KPIs (MVRV ~0.84, z-scores near 2022 lows, ~39% holders in profit) place ETH in fair-to-cycle-low territory; deep value likely ~25% lower (~$1,500).
Tokenomics: annualized issuance ~0.6–0.83% with ~90% of validator rewards from issuance; lower fee revenue cut staking yields but inflation remains low.
Valuation diverges widely ($2 to $24k models); use a holistic framework—tokenomics, fee cash flow, TVL/on-chain GDP, stablecoin supply—to form conviction.
Investment process: anchor portfolios in Bitcoin, compare ETH versus alternatives, require fair/deep value plus fundamentals; TDR Pro provides watchlists, buyback alerts, and dashboards.
Market and risk view: crypto remains volatile amid macro uncertainty; expect choppy bottoms, potential early ETH bottoming, and the need for rigorous on-chain research.

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