Ethereum’s Value Hits 41-Month Low Compared to Bitcoin

Ethereum’s value against Bitcoin has been on a downward spiral, reaching its lowest point since April 2021 and experiencing a significant decline of more than 55% from its peak in 2021.

The sell-off of Ether has been gaining momentum, with Ethereum trading at 0.039 BTC, marking a 24% decrease this year and a 35% drop from its year-to-date high. This downtrend extends to other cryptocurrencies like Solana (SOL), Binance Coin (BNB), and Tron (TRX).

In terms of US dollars, Ethereum has been on a downward trend for four consecutive months, currently hovering around $2,300, its lowest level since February.

The sell-off of Ethereum is attributed to the lukewarm response from institutional investors, who have been steering clear of spot ETFs. Data indicates that Ether ETFs have seen net outflows exceeding $581 million, holding assets totaling $6.62 billion, significantly lower than spot Bitcoin funds, which have amassed over $54 billion with net inflows of $18 billion.

The recent decline in Ether can also be traced back to liquidations by the Ethereum Foundation and Vitalik Buterin. Buterin sold tokens worth $2.2 million, while the foundation offloaded 350,000 coins.

Concerns have emerged regarding Ethereum losing market share to layer-2 networks such as Base, Arbitrum, Polygon, and Blast, known for their faster transaction speeds and lower costs compared to Ethereum.

Furthermore, there are indications that significant investors are divesting from Ether. For instance, one investor recently sold ETH valued at nearly $10 million within a 24-hour period.

Jump Trading, a prominent entity in the crypto industry, notably liquidated its Ethereum assets, with its total Ether holdings plummeting from over $531 million in July to zero.

The ongoing sell-off of Ether commenced following the formation of a triple-top chart pattern around the 0.088 level between May and September 2021, with the coin dropping below the pattern’s neckline at 0.049 on May 20 of this year. Additionally, a death cross pattern emerged in April when the 50-week and 200-week moving averages intersected.

The Relative Strength Index has retreated and retested the oversold level of 30, signaling a robust downward momentum. Consequently, Ether is anticipated to continue on a downward trajectory, with a potential reference point at 0.0224, representing a 42% decrease from the current level.