Ethereum, the second-largest cryptocurrency, has faced a significant drop against Bitcoin, raising market concerns and future queries.
Ethereum's Decline Against Bitcoin
In recent months, Ethereum has declined by 74% against Bitcoin, reaching new lows. This drop followed the network's transition from the Proof of Work to Proof of Stake mechanism in September 2022. Alex Thorn, Head of Research at Galaxy, noted that the ETH to BTC rate fell to 0.02210.
Market Impact and Forecasts
Ethereum continues to power many key decentralized finance solutions, yet the Ether token has exhibited a bearish trend with a 47% decline over the past year. US exchange-traded funds directly investing in Ethereum have observed extended withdrawals since July 2024. Standard Chartered has reduced its year-end Ethereum price prediction by 60%, anticipating $4,000.
Reversal Potential and Future
While Ethereum has shown larger losses compared to Bitcoin, a reversal is possible. Renewed investor interest in ETH or a fall in Bitcoin dominance could lead to Ethereum regaining lost ground. The upcoming Pectra network upgrade is expected to positively impact market sentiment in the short term.
Ethereum faces significant challenges and is awaiting a foothold for a reversal. The upcoming upgrade and market dynamics will indicate whether it can regain its standing.
