ETH/BTC ratio hits a new low! Can Ethereum break free from Bitcoin's shadow?
Speculators still have hope for ETH, predicting that by 2025, the price of ETH could reach $4000. However, the truth is that Ethereum's weakness against Bitcoin has persisted for a full three years, with the new low of the ETH/BTC ratio at 0.022 being the best proof.
Alex Thorn from Galaxy Digital Research pointed out that the decline of ETH against Bitcoin is mainly due to the shift from proof of work to proof of stake. Some even suggest that if the network could return to proof of work, it might once again support the value of Altcoins.
However, Quinn Thompson, founder of hedge fund VC Lekker Fund, believes that ETH is simply not worth investing in. He cited several reasons, including a decline in network activity, bluntly stating that ETH's status as an investment is no longer valid. A network valued at $225 billion, with declining trading activity, user growth, and fee income, is simply not convincing.
Nic Carter, partner at Castle Island Ventures and co-founder of data aggregator Coinmetrics, pointed the finger at L2s, claiming that L2s have siphoned off the value of ETH, leading to ETH being overshadowed by its own tokens.
Thompson also predicts that during the bull market of 2023-2024, the ETH/BTC ratio will continue to decline, and it could get worse during the bear market. Recent ETF flows also indicate that institutional investors' enthusiasm for altcoins has significantly waned. The U.S. spot BTC ETF has seen a net inflow of over $1 billion for several consecutive days, while the ETH ETF has been seeing continuous net outflows.
Despite this, ETH's path to recovery has not been hindered. On the prediction platform Polymarket, bettors are generally optimistic about ETH's price target for 2025, with the highest betting volume at the $4000 target. However, for options traders on Deribit, they are more optimistic that ETH can reach $4000 before September, even though the probability is only 10%.
Currently, the price of ETH has fallen to $1840, a 54% drop from last December's high of $4000. But this investment debate about ETH is clearly still ongoing.
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