3 Reasons Why Ethereum Can't Match Bitcoin's Success

Despite being the second-largest cryptocurrency, Ethereum (ETH) has struggled in 2024 to keep up with Bitcoin (BTC). While Bitcoin has surged by 40% this year, Ethereum has seen little price movement, leading to a drop in the ETH/BTC ratio. Here are three key reasons why Ethereum is underperforming compared to Bitcoin:

1. Bitcoin ETF Success

The launch of spot Bitcoin ETFs in the U.S. has significantly boosted BTC’s demand, with these ETFs making up 8% of the trading volume. In contrast, Ethereum ETFs only represent 1% of the market, indicating a larger demand for Bitcoin investment products.

2. Rising Bitcoin Dominance

Bitcoin's market dominance has reached 58%, the highest in 40 months. Investors are increasingly choosing Bitcoin over altcoins like Ethereum, further weakening ETH’s performance relative to BTC.

3. Weak On-Chain Metrics

Ethereum's on-chain activity is down, with a 7.7% drop in active addresses and a 19% decrease in decentralized application (DApp) usage over the last 30 days. Competing networks like Solana and Tron have seen growth, adding pressure on Ethereum's price.

As Bitcoin continues to dominate, Ethereum faces challenges in regaining momentum in the current market environment.

Disclaimer: This post is for informational purposes only and does not constitute financial advice.