Ethereum has underperformed Bitcoin over the past two years, causing the ETH/BTC ratio to weaken and hit a low of $0.04622 on May 1, the lowest level since April 2021.
Ethereum’s underperformance relative to Bitcoin this cycle is due to “significant lag in speculative interest” from the STH group. (The STH group refers to “investors who have purchased tokens within the past 155 days and are generally considered to be representative of new investor demand.”)
Before setting an all-time high in March, Bitcoin experienced a “significant increase in speculative activity” in terms of capital accumulation in STH. This is not reflected in ETH, which has yet to break through its previous all-time high. While Bitcoin’s STH realized cap is almost at the same level as the last bull run peak, ETH’s STH realized cap is still less than half of the previous cycle level, indicating a clear lack of new capital inflows.
