Coincircle News Report:
Bitcoin Takes Largest Price Lead in Altcoin Ecosystem, Leaving Ethereum (Traditionally Ranked Second) in the Dust.
The market capitalization of OG cryptocurrencies now exceeds that of the second-ranked cryptocurrency by over $1 trillion, with the latter’s price falling to its lowest point since early 2021.
Bitcoin’s Trillion-Dollar Lead
According to data from CoinGecko, Bitcoin’s trading price on Thursday was $68,180, with a market capitalization of $1.34 trillion. In contrast, Ethereum’s trading price was $2,530, with a market capitalization of $305 billion.
This makes the ETH/BTC ratio a mere 0.037, the lowest level since Ethereum’s rapid rise in the past 12 months in April 2021. In previous bull markets, Ethereum followed the general price behavior of other major altcoins: rising when Bitcoin rises.
This time, however, it’s different. Since Ethereum’s highly anticipated Merge upgrade in September 2022, this top-tier smart contract platform has lost over 50% of its value relative to BTC, despite the overall cryptocurrency market rising in USD terms since then.
In the past two years, several of the most bullish catalysts for cryptocurrencies have been Bitcoin-centric. In March 2023, as several U.S. banks collapsed, Bitcoin’s reputation as “digital gold” encouraged investors to flock to Bitcoin. Later, Bitcoin rose for several months due to excitement over the approval of a Bitcoin spot ETF, and rose again after the success of ETFs in 2024.
During this period, Bitcoin’s dominance has reclaimed its highest point in years, currently accounting for 59% of the entire cryptocurrency market, according to The Wall Street Journal.
Poor Performance of Ethereum
Unlike the Bitcoin ETF, which has absorbed over $20 billion in net inflows since its launch, the Ethereum spot ETF launched in July has seen a net outflow since then due to losses in grayscale Ethereum Trust (ETHE).
According to CryptoQuant and the decline in Coinbase’s premium index, institutional investors may be reducing their exposure to ETH.
Ethereum Bulls Remain Defiant
However, despite its poor performance, Ethereum advocate Anthony Sassal argued on Wednesday that Ethereum’s L2 is dismantling any existing FUD around Ethereum, as the network is slow and expensive, and the current short positions are merely “followers.”
On Wednesday, Ryan Sean Adams, host of the Bankless podcast, added, “ETH only lacks confidence at the moment, but this situation could change overnight.”
