The 2023-24 crypto cycle has witnessed a deviation from historical norms in the ETH/BTC ratio. The ratio, in question, is a key indicator of capital rotation and risk appetite in the market.
Despite the beginning of a bull market in late 2022, the ratio has unexpectedly continued to decline. Experts suggest that there are two factors at play with regard to this relative underperformance.
Unexpected ETH/BTC Ratio
According to the latest joint report by Glassnode and CME Group, the approval of spot Bitcoin ETFs in the US in January 2024 is the first factor that significantly boosted buy-side pressure for the leading crypto.
Secondly, the intense competition among Proof-of-Stake (PoS) blockchains has been challenging Ethereum’s dominance in areas such as liquidity, capital attraction, user experience, and, most importantly, scalability.
“Historically, the largest asset, Bitcoin, tends to lead the market during bear markets and early bull markets but lags during the more speculative p
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