Ethereum Faces Challenges as ETH/BTC Ratio Hits Multi-Year Lows Ethereum’s performance against Bitcoin (BTC) has weakened significantly , with the ETH/BTC ratio dropping nearly 70% since the Merge , according to Cointelegraph . Despite initial expectations that Ethereum’s transition to Proof-of-Stake (PoS) would make ETH deflationary , key market trends have worked against Ethereum’s growth . Why Is Ethereum Losing Market Share to Bitcoin? 1. Lower Network Activity & Declining Transaction Fees Ethereum’s deflationary supply growth has stalled due to lower on-chain activity. Gas fees remain low , limiting the amount of ETH burned via EIP-1559 . 2. Institutional Investors Favor Bitcoin Over ETH Spot Bitcoin ETFs have attracted billions in inflows , increasing BTC’s dominance. ETH-based ETFs are still lagging in demand , limiting institutional exposure. 3. Solana & Other Layer 1s Are Gaining Market Share Solana (SOL) and other Layer 1 blockchains have outperformed Ethereum in recent months. Ethereum’s high costs and slower transactions continue to push users toward alternative networks. Will Ethereum Rebound or Continue Its Downtrend? Bullish Case for Ethereum: Ethereum ETFs and network upgrades (Dencun upgrade) could reignite demand. DeFi and NFT market rebounds could increase network activity and gas fees. If Bitcoin consolidates, ETH could catch up as capital rotates into altcoins. Bearish Risks for Ethereum: Bitcoin dominance continues rising , keeping ETH suppressed. Ethereum struggles to differentiate itself against newer Layer 1 competitors. Major ETH holders are still selling, applying downward pressure. Conclusion Ethereum’s 70% decline against Bitcoin since the Merge highlights growing concerns about ETH’s long-term positioning . With institutional money flowing into BTC and Ethereum facing stiff competition from Solana and other Layer 1s , ETH needs a strong catalyst to regain its momentum . While a short-term ETH/BTC rebound is possible , Ethereum must increase network activity and investor confidence to reverse its long-term downtrend . To learn more about the latest crypto market trends, explore our article on key developments shaping Ethereum’s price action and institutional adoption.
