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Bitcoin vs. Ethereum: Why BTC is Dominating the Battle

Bitcoin vs. Ethereum

Bitcoin (BTC) and Ethereum (ETH) remain the titans, each vying for dominance. The latest crypto cycle of 2023-24 has brought unexpected shifts, particularly in the ETH/BTC ratio, a critical indicator of market sentiment and capital rotation. This article explores why Bitcoin is currently outperforming Ethereum and how upcoming changes, such as the introduction of spot Ethereum ETFs, might reshape the crypto market dynamics.

The Unexpected ETH/BTC Ratio

The ETH/BTC ratio has historically been a key metric for gauging market trends, reflecting the relative strength and risk appetite associated with Ethereum compared to Bitcoin. Traditionally, Bitcoin leads during bear markets and the early stages of bull markets, while Ethereum gains prominence during speculative late-stage bull markets. However, the 2023-24 cycle has deviated from this norm, with the ETH/BTC ratio continuing to decline even as the bull market gains momentum.

Factors Behind Bitcoin’s Dominance

According to a joint report by Glassnode and CME Group, two primary factors have contributed to Bitcoin’s current dominance over Ethereum:

  1. Approval of Spot Bitcoin ETFs: The approval of spot Bitcoin ETFs in the US in January 2024 has significantly increased buy-side pressure for Bitcoin. This move has attracted substantial capital inflows, bolstering Bitcoin’s market position and reinforcing its status as the leading cryptocurrency.
  2. Competition Among Pos Blockchains: Ethereum’s dominance in areas like liquidity, capital attraction, user experience, and scalability is being challenged by other Proof-of-Stake (Pos) blockchains. These competitors offer alternative solutions that appeal to investors and users, thereby diluting Ethereum’s market share.

Potential Shift with Spot Ethereum ETFs

Despite the current underperformance, experts from Glassnode and CME Group anticipate a potential reversal in the ETH/BTC ratio with the introduction of spot Ethereum ETFs. Several prominent asset managers, including VanEck, Grayscale, Fidelity, BlackRock, 21Shares, Franklin Templeton, and Bitwise, have recently submitted their revised spot ETH ETF registration statements to the US Securities and Exchange Commission (SEC).

The SEC has set a deadline of July 8 for issuers to submit their amended drafts, and industry insiders are optimistic about the approval within the next two weeks. The approval of these ETFs could catalyze renewed interest and investment in Ethereum, potentially reversing the downtrend in the ETH/BTC ratio.

Ethereum’s On-Chain Metrics

Amidst these developments, Ethereum has managed to maintain its price above the $3,000 mark, reflecting a relatively stable market sentiment. On-chain metrics further suggest that Ethereum might be nearing a bottom, indicating a potential bullish reversal.

Realized Cap

The Realized Cap of Ethereum currently stands at $240 billion. When the market cap is close to or below the realized cap, it typically signifies that many holders are at a loss. Historically, this has been a late-stage bear market indicator, suggesting that Ethereum’s price could be poised for an upward movement.

Market Value to Realized Value (MVRV) Ratio

The MVRV ratio, which compares the market value to the realized value of Ethereum, has shown signs of improvement. An MVRV ratio above 1.0 indicates that the average Ethereum investor is holding unrealized profits. The ratio has been steadily increasing since mid-2023, transitioning from a late-stage bear market to a recovery and bull market phase.


Bitcoin’s dominance in the current crypto cycle is influenced by regulatory approvals and competition dynamics. However, the landscape is poised for change with the potential introduction of spot Ethereum ETFs. This development could attract significant capital inflows into Ethereum, potentially altering the ETH/BTC ratio and driving renewed interest in the altcoin.

As the market evolves, investors and analysts will closely watch these trends, making informed decisions based on regulatory developments and on-chain metrics. Whether Ethereum can regain its momentum or Bitcoin continues to lead, the crypto market remains a dynamic and exciting space, full of opportunities and challenges.

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Julie J

Julie is a renowned crypto journalist with a passion for uncovering the latest trends in blockchain and cryptocurrency. With over a decade of experience, she has become a trusted voice in the industry, providing insightful analysis and in-depth reporting on groundbreaking developments. Julie's work has been featured in leading publications, solidifying her reputation as a leading expert in the field.

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