Ethereum (ETH) is showing a relatively strong performance compared with Bitcoin (BTC). An analysis says signs of capital rotation are being detected as ETF flows and on-chain indicators diverge.

On April 14, CoinDesk reported that over the past 24 hours Ethereum rose about 8 percent, outpacing Bitcoin's 5 percent gain. Over the past week, Ethereum posted returns about 4 percent higher, and over the past month about 9 percent higher.

ETF flows also contrasted. On April 13, U.S. spot Bitcoin ETFs saw net outflows totaling $325.8 million. Fidelity's FBTC led the outflows with $229 million, followed by Ark's ARKB with $63 million.

By contrast, Ethereum ETFs turned to net inflows. They drew $7.7 million on a daily basis, and inflows totaled $187 million for the week ended April 10, showing the strongest flow so far this year. It was a clear reversal given net outflows of about $308 million over the prior three weeks. Cumulative net inflows also reached a record $11.68 billion.

On-chain indicators also tilted toward Ethereum. Data platform Artemis showed Ethereum's daily transaction count rose 41 percent from the previous week to about 3.6 million. The rapid surge in transactions suggests network activity has picked up.

Qualitative indicators, however, were mixed. Over the same period, stablecoin transfer volume fell 42.6 percent and fees dropped about 50 percent. That means transaction counts increased but the size per transaction shrank, making economic throughput lighter.

Bitcoin is holding up relatively well despite ETF outflows. On-chain analytics firm Glassnode said in a recent report that spot demand is absorbing the ETF outflows. At the same time, some momentum indicators are also showing signs of overheating, raising the possibility of greater short-term volatility.

The market is watching whether a rotational flow is forming in which funds move from Bitcoin to Ethereum. For that trend to persist, inflows into Ethereum ETFs would need to continue while actual on-chain fund movement also expands.

The quality of on-chain activity also matters. In the summer of 2025, Ethereum saw economic throughput rise sharply on a surge in USDC and USDT transfer volumes, and its price also rose to around $4,000.

An analysis says whether this rally ends as a short-term rebound or extends into a longer upcycle will depend on how long inflows persist and whether the quality of on-chain activity improves.