Ethereum Value Loses Against Bitcoin Amid Startup Exchange-Traded Fund Buzz

By: Isha Das

Amid predictions of an imminent spot exchange-traded fund (ETF) in the U.S., Ethereum's value against Bitcoin has dipped to historic lows. Prior data from a reputable crypto intelligence platform indicates that since Ethereum transitioned into a proof-of-stake network in September 2022, the ETH/BTC ratio has steadily declined. Over the last 24 hours, this metric reached its nadir since May 2021 at 0.048.

The ETH/BTC ratio is an important indicator of Ethereum's performance compared to Bitcoin. A rise in this ratio indicates a strong or steady Ethereum value, suggesting a marketplace favor for ETH versus BTC. On the other hand, a lower ETH/BTC ratio denotes that Ethereum is underperforming in comparison to Bitcoin, potentially indicating investor preferences for Bitcoin's perceived safety.

This ratio isn't strictly about price fluctuations, as it also covers shifts in investor confidence and market sentiment between these two major cryptocurrencies. Meanwhile, Bitcoin's price has significantly outpaced Ethereum's in the previous year, with a more than 170% increase to a 21-month high of over $47,000. This positive trend could be because of optimism about the market and the potential approval of a spot ETF.

In contrast, Ethereum's less impressive price performance coincides with several futures-based ETFs for the digital asset launched last year. These ETFs saw tepid demand, leading an asset manager to dub ETH the 'least loved altcoin' compared to competitors like Solana.