Ether (ETH) fell to its lowest level against Bitcoin (BTC) since March 2021 on Sunday, as the world’s second-largest token extended losses against its biggest rival.
Ether fell to 0.03 BTC on Sunday, almost 50% lower than a year ago, as bitcoin soared ahead of the inauguration of US President-elect Donald Trump. The exchange rate of the two tokens, conventionally called the ratio, peaked above 0.08 in 2022.
Since then, the value proposition of ETH has been in decline. Bitcoin hit an all-time high above $109,000 earlier Monday and has returned 160% for investors over the past year. Ether, meanwhile, has only gained 40% and is about 30% below its 2021 high. Ether tends to rally when traders see upside for the Ethereum blockchain, the premier to offer smart contracts and decentralized finance (DeFi) applications. This weakens when they prefer Bitcoin or other blockchains.
“Ethereum has significantly underperformed this cycle, especially as Solana gains traction thanks to the memecoin frenzy and events like Trump officially launching memecoin on Solana instead of Ethereum,” Min said Jung, investment analyst at Presto Research, to CoinDesk in a Telegram message.
“That said, the recent accumulation of $ETH by World Liberty Financial highlights that Ethereum continues to maintain strong appeal among institutions. As the only cryptocurrency with an ETF, besides Bitcoin, Ethereum is well positioned to be the next focal point after Bitcoin,” Jung added. World Liberty Financial is a crypto lending platform promoted by Trump and his sons. Bitcoin is not reaching new heights only against its #1 competitor in the digital asset space. He did the same against competing investments in traditional assets. Bitcoin now costs 40 ounces. of gold, or in equivalent terms, bitcoin to gold market capitalization now stands at 11.4%.
