Ethereum is already well behind Bitcoin, which has the biggest price advantage over the altcoin ecosystem in recent history, according to current price action.
Ethereum, which has fallen to its lowest level since the start of 2021, is around $1 trillion lower than Bitcoin.
According to Binance data, Bitcoin’s market worth was $1.34 trillion on Monday, trading at about $68,000.
In contrast, the market value of the most popular altcoin was approximately $300 billion.
The ETH/BTC ratio has now dropped to a low of barely 0.037, last seen in April 2021, after Ethereum’s spectacular rise over the previous 12 months. During the last bull market, Ethereum’s price followed the same path as other significant altcoins: it rose in value with Bitcoin.
This persistent performance gap is mostly caused by the slower development in institutional demand for Ethereum than Bitcoin. The introduction of spot Ethereum ETFs in July 2024 received a mixed reception and did not affect the summer trend.
Open interest in Bitcoin CME futures, which act as a stand-in for institutional interest, recently hit consecutive all-time highs, per the Kaiko research study. Ether futures on the CME, on the other hand, have very little open interest at 7,300 contracts ($970 million). This suggests that institutional interest in Ethereum futures is significantly lower and that the market is less developed.
After Ethereum’s much-awaited Merge update in September 2022, the top smart contract platform lost more than half of its value in relation to Bitcoin, despite the fact that the overall cryptocurrency market’s value has since surged in US dollars.
Over the past two years, Bitcoin has been at the heart of some of the most optimistic cryptocurrency catalysts. Due to its reputation as “digital gold,” investors flocked to Bitcoin in March 2023 as some US institutions failed. Later, the price of Bitcoin rose for several months as expectations increased for the approval of Bitcoin spot ETFs. After the ETF’s tremendous performance in 2024, this pattern persisted.
Unlike Bitcoin ETFs, which have absorbed roughly $20 billion in net flows since their launch, Ethereum spot ETFs have seen net negative flows since going live in July due to losses from the Greyscale Ethereum Trust.
Online Ethereum supporters are unwavering despite these unsatisfactory outcomes. Ethereum educator Anthony Sassal said that Ethereum’s Layer 2 solutions prove that existing supporters are not just “bandwagoners,” refuting claims that the network is expensive and slow.
Due to ETH’s dismal performance following the merger and growing competition from “ETH killers” like Solana, traders favor digital assets with higher betas. Through various Layer 2 solutions developed on its network, which have outperformed the top altcoin by a considerable margin, investors can also get exposure to Ethereum.
ETH could profit from the upcoming US elections by lowering regulatory concerns despite Bitcoin being the most well-known cryptocurrency. The Ethereum environment is also always changing, which may affect its future acceptance and value proposition.
