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Ethereum (ETH) continues to lose ground to Bitcoin (BTC) as the latter’s dominance increases, with US President-elect Donald Trump set to take office later today. At the time of writing, the ETH/BTC trading pair was standing at 0.031, representing a four-year low.
ETH/BTC continues to decline as Trump focuses on Bitcoin
Over the past year, Bitcoin’s value has risen by a staggering 158%, rising from around $41,000 on January 21, 2024 to $107,608 at the time of writing. The cryptocurrency has consistently reached all-time highs (ATH) throughout the year. In contrast, Ethereum has generated a modest return of around 35% over the same period and is still 32% below its November 2021 ATH of $4,878.
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According to the weekly chart below from TradingView, the ETH/BTC trading pair – also referred to as the ETH/BTC ratio in the cryptocurrency industry – has hit a new four-year low. This decline has raised concerns about the potential emergence of an altcoin season led by Ethereum.
The ETH/BTC ratio is currently trading at 0.031, and has erased all gains accumulated since March 2021. The pair peaked at 0.087 in December 2021, during the peak altcoin season of that year. However, since then, Ethereum, the second largest digital asset by market cap, has seen a steady decline against Bitcoin.
In May 2024, the ratio fell below 0.054, a crucial support level that previously held in June 2022. Several factors have contributed to Ethereum’s poor performance, including Trump’s perceived preference for Bitcoin and increasing competition from rival smart contract platforms such as Solana (Sol). .
Unlike Bitcoin, Ethereum has struggled with adoption. Companies around the world are increasingly incorporating Bitcoin into their balance sheets, strengthening Bitcoin’s position as a major digital asset. In addition, speculation about the creation of a US Strategic Bitcoin Reserve has reinforced the narrative about the limited supply of Bitcoin, causing its price to rise.
On the contrary, Ethereum is relatively… High The rate of issuance has cast doubt on the “ultrasonic money” narrative. Ethereum’s 2024 performance has also eroded confidence among some of its largest holders. Notably, the ETH whale recently Sold 10,070 Ethereum, with a loss of $1 million, indicating a decline in investor confidence.
Will 2025 change Ethereum’s fortunes?
While 2024 has been a challenging year for Ethereum in terms of price performance, cryptocurrency analysts remain optimistic about the asset’s prospects in 2025. For example, a report by Steno Research He predicts That Ethereum could rise to $8,000 this year.
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Likewise, cryptocurrency analyst Dan Expectations The ETH/BTC trading pair may rise above 0.04 during the first quarter of 2025. Experienced Renewed interest from institutional investors, fueling hopes for significant inflows of capital into the smart contract platform.
However, Ethereum must first He overcomes Strong resistance at $4000 price level. At press time, Ethereum is trading at $3,368, down 1.3% over the past 24 hours.
Featured image from Unsplash, charts from TradingView.com