Key Points
- Bitcoin’s significant surge has led to the ETH-BTC ratio hitting its lowest since April 2021.
- The approval of eleven Bitcoin ETFs in the US has increased interest in Bitcoin, while Ethereum struggles.
Bitcoin, the largest cryptocurrency by market capitalization, saw a nearly 9% surge in the past 24 hours, catching investors off guard. This surge was accompanied by significant gains in altcoins.
However, Ether, the native cryptocurrency of the Ethereum blockchain, showed a lacklustre performance with a mere 3% increase in its price, according to data from CoinMarketCap.
Consequently, the ETH-BTC ratio has reached its lowest point since April 2021. This development has sparked a debate among the digital asset community on social media.
ETH-BTC Ratio’s Downtrend
The ETH-BTC ratio has been trending downwards, as pointed out by crypto analyst Dippy.eth on social media. The analyst believes that if Ethereum outperforms Bitcoin in the near future, tokens on the Ethereum blockchain will rally.
He predicts that the ETH-BTC bottom is imminent and once it is reached, altcoins will rally as Bitcoin consolidates at higher price levels.
As it stands, Bitcoin is currently valued above $66,000, while Ether is under the $3,000 price range. According to TradingView data, the ETH-BTC ratio is at 0.04516 as of 8:35 a.m. ET on Thursday.
CoinMarketCap data reveals that Bitcoin’s trading volume surged by 55.7% in the past 24 hours, while Ethereum’s volume increased by only 22%. Bitcoin’s market dominance continues to rise, currently at 54.7%, while Ethereum lags behind with 15.1%.
Increased Interest in Bitcoin
The general interest in Bitcoin has seen a significant increase following the approval of eleven spot Bitcoin exchange-traded funds (ETFs) in the United States in January this year. This has not been the case for Ethereum, as the chances of a spot ETH ETF in the United States being approved are slim.
Finance lawyer Scott Johnsson pointed out that the US Securities and Exchange Commission (SEC) is looking for substantial reasons to deny the spot ETH ETF applications filed by leading asset management firms like BlackRock and Fidelity.
The SEC views ETH as a security, and Johnsson thinks that it could argue that the applications are improperly filed as commodity-based trust shares. Eric Balchunas, a senior Bloomberg analyst, stated on social media that the chances of an ETH ETF approval are “slim to none”.
In a report sharing the outlook for the crypto market in 2024, crypto exchange Coinbase predicted that institutional investors will remain focused on Bitcoin in the first half of the year. This is due to the pent-up demand from traditional investors seeking to enter the market.
The rise in popularity of Layer 2 and Layer 3 blockchain networks is also a major factor in the decreasing interest in Ethereum. Recently, Polygon Labs CEO Marc Boiron stated that “L3s exist only to take value away from Ethereum and onto the L2s on which the L3s are built.”
