The cryptocurrency market in 2024 has seen a significant turnaround, leaving the long, harsh crypto winter of 2022 and 2023 behind. A pivotal moment this year was the approval of Bitcoin’s spot ETF by the U.S. Securities and Exchange Commission (SEC), which ignited a bullish run, pushing Bitcoin to unprecedented heights. However, despite Bitcoin’s stellar performance, Ethereum has struggled to keep up. This article delves into the factors behind Ethereum’s lag, the current market sentiment, and what the future holds for these two leading cryptocurrencies.
2024 started with a significant boost for Bitcoin when the SEC approved its spot ETF. This approval not only catalyzed Bitcoin’s price surge but also fostered institutional adoption from banks, asset managers, and even governments globally. Bitcoin quickly shattered its previous all-time highs and remains robust, though it has entered a period of consolidation in recent weeks.
Despite Ethereum’s strong correlation with Bitcoin—its price movements and market sentiment are closely linked—Ethereum has not experienced the same level of bullish momentum. As of now, Ethereum’s price stands at $3,065, a considerable drop from its all-time high of $4,878 in 2021.
On-chain data reveals a mixed bag for Ethereum. Currently, 75% of Ethereum holders are in profit, 6% are breaking even, and 19% are at a loss. This data suggests a relatively bullish sentiment among traders and investors. Moreover, exchange inflows are slightly lower than outflows, indicating that holders are moving their assets to private wallets, signaling long-term confidence.
Ethereum has managed to stay above the $3,000 mark, with immediate support at around $2,997. The 50-hour moving average (MA) is currently above the 200-hour MA, suggesting a short-term bullish trend. However, any drop below the 50-hour MA could indicate weakening bullish strength.
If Ethereum’s price breaks above the immediate resistance level of $3,220 and sustains this momentum, we could see a resurgence of bullish sentiment. The next target would be $3,390, followed by potential gains pushing the price towards $3,500 and beyond, provided the buying pressure remains strong.
Conversely, if Ethereum fails to break through the resistance and drops below the 50-hour MA, a decline to the support level at $2,997 is likely. A further breakdown below this support could trigger a significant tumble, with potential targets at $2,900 and $2,800.
Bitcoin’s ETF approval has undeniably bolstered its price and market position. However, Ethereum’s inability to match Bitcoin’s pace raises questions about its future performance. Ethereum’s strong fundamentals, including its significant role in the decentralized finance (DeFi) ecosystem and the upcoming upgrades aimed at improving scalability and reducing transaction costs, still position it as a crucial player in the crypto space.
Bitcoin continues to dominate the cryptocurrency market in 2024, buoyed by the SEC’s spot ETF approval and widespread institutional adoption. Meanwhile, Ethereum, despite its potential and market correlation with Bitcoin, lags in performance. The coming months will be critical in determining whether Ethereum can close the gap or if Bitcoin will maintain its lead. Investors should closely monitor market trends, technical indicators, and on-chain data to navigate this complex and rapidly evolving landscape.
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