Ethereum (ETH) Falls Behind Bitcoin with ETHBTC Hitting 42-Month Low
Ethereum (ETH) has recently hit a 42-month low against Bitcoin, a level not seen since April 2021. This prolonged period of underperformance by Ether compared to Bitcoin has led analysts and investors to speculate on whether ETH is approaching a bottom or if there is more room for decline.
Alex Thorn, the head of research at Galaxy, pointed out that the ETH/BTC ratio dropped below 0.03 for the first time in years. He highlighted a significant 53% decrease since Ethereum’s shift to proof-of-stake in September 2022 and raised concerns about what could potentially halt this downward trend.
Fred Krueger, an investor and mathematician, expressed a grim view by suggesting that ETH is “on the edge of collapse” relative to Bitcoin. He mentioned an imbalance in ETF inflows between Bitcoin and Ether as a possible explanation for Ether’s lackluster performance.
Bitcoin ETFs have been witnessing substantial inflows, with 305,400 BTC flowing in since their launch. In contrast, Ether ETFs have experienced net negative flows. Notably, Ether ETFs in the U.S. have seen $581 million in net outflows since their introduction, with Grayscale’s Ether ETF bearing the brunt of the outflows at $2.7 billion, as reported by Farside Investors.
Despite the prevailing pessimism, some analysts maintain a more optimistic outlook for Ethereum. Hedgex emphasized that the relative strength index for ETH/BTC is currently at historically low levels. This oversold status has only occurred five times in Ethereum’s history, and according to Hedgex, such conditions have consistently preceded substantial price surges.
In conclusion, Ethereum’s struggle against Bitcoin has raised concerns among market participants, with contrasting views on its future trajectory. While some foresee a potential turnaround based on historical patterns, others remain cautious about Ether’s performance in the near term. The dynamics between Ethereum and Bitcoin continue to be closely monitored by investors and analysts alike in the volatile cryptocurrency market.
