Ethereum’s ETH/BTC ratio has reached a five-year low of 0.01787, reflecting a 67% decline over the past year. Despite the Dencun upgrade, Ethereum’s value has dropped 50%, with decreased network activity and competition from other chains. Currently priced at $1,587, Ethereum may face further declines if it fails to maintain support above $1,550.
The ETH/BTC ratio has plunged to a five-year low, currently at 0.01787— the lowest since January 2020—suggesting Ethereum’s significant underperformance compared to Bitcoin. The ratio has fallen by nearly 5% in the last 24 hours, 24% over the past month, and a staggering 67% year-on-year. This trend highlights Bitcoin’s growing status as a preferred store of value among investors, contrasting sharply with Ethereum’s struggle amid a 50% decline in its value within the last year.
Recent developments, including the Dencun upgrade, have not halted Ethereum’s decline. Key metrics such as network fees have dropped to multi-year lows, and the activity within decentralised finance (DeFi) has diminished. Competitor chains like Solana and BNB Chain are drawing liquidity away from Ethereum, exacerbating its challenges in retaining investor interest.
Ethereum’s rollup-based scaling strategy has led to decreased transactions and fee income on the mainnet, as users migrate to layer-2 solutions such as Base and Arbitrum. While layer-2 solutions are intended to enhance scalability, they have negatively impacted Ethereum’s short-term price performance. Furthermore, the lack of new catalysts coupled with regulatory uncertainty has adversely affected market sentiment towards Ethereum.
Currently priced at $1,587, ETH’s relative strength index (RSI) is slightly above 40, placing it in neutral territory. A rally could begin if the price breaks above the 20-day moving average at $1,618 and surpasses $1,650. Conversely, if Ethereum fails to hold above the $1,550 support, it could decline further to approximately $1,440. While Ethereum remains integral to the crypto market, its persistent weakness against Bitcoin raises concerns about the potential for bullish recovery in the near future.
