Ethereum has gained 29.3% over the past seven days, outpacing Bitcoin's weekly advance, as Fundstrat's Tom Lee argues a long-awaited rotation into ETH has begun. Yet on-chain data shows three trading firms still hold over $600 million in short positions against Bitcoin and Ethereum, with liquidation levels far above current prices.
Ethereum traded near $2,463 on Aug. 24 after climbing 29.3% over seven days. That outperformed Bitcoin's 21.4% weekly advance over the same period. Fundstrat co-founder Tom Lee said the conditions behind an ETH rotation had been building for years.
Ethereum gains ground against Bitcoin
The ETH/BTC ratio stood near 0.0318, up from about 0.02994 when BitMine last discussed Ethereum's relative performance on Aug. 17. A rising ratio means one Ether buys more Bitcoin than before, offering evidence of relative strength beyond ETH's dollar price alone. Lee wrote on X: "This is nearly a decade in the making", pointing to tokenization, stablecoins and AI applications as forces strengthening Ethereum's role as a settlement network.
ETF inflows and BitMine's treasury bet
U.S. spot Ethereum ETFs attracted $365 million in July, their strongest month since launch, exceeding the $205 million Bitcoin funds received over the same period. Lee also chairs BitMine Immersion Technologies, which reported holding 5,815,164 ETH as of Aug. 16, about 4.8% of Ethereum's estimated supply. Lee said ETH could easily exceed $10,000 within one or two years, though that forecast remains speculative and unsupported by any guaranteed outcome.
Short sellers hold on despite the rally
Even so, Abraxas Capital, Fasanara Capital and Wintermute still hold combined short positions of 138,569 ETH worth $338 million and 3,425 BTC worth $265 million, according to blockchain tracker Lookonchain. Abraxas Capital's two ETH shorts liquidate at $4,008 and $3,958 with spot trading near $2,440, while its BTC shorts liquidate at $128,521 and $140,437 against a $77,381 spot price.
No position faces liquidation unless Bitcoin climbs 66% or Ethereum climbs 62%, explaining why the rally's earlier liquidation wave passed them by. Fasanara Capital sits 18.87% underwater on a $74.81 million ETH short at 15X leverage, while Wintermute remains marginally profitable on both assets.
Ethereum still trades roughly 50% below its August 2025 record of $4,946, leaving Lee's $10,000 target dependent on a recovery well beyond the latest weekly rally.
Sources: crypto.news, BeInCrypto
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