Ethereum (ETH) is currently trading at approximately $1,970.94, while Bitcoin (BTC) stands at around $99,526. Despite Ethereum's recent Pectra upgrade, which aims to enhance transaction speed and cost efficiency, ETH has underperformed BTC by about 44% since its transition to proof-of-stake in 2022 .
Several factors contribute to this underperformance:
Institutional Demand: Bitcoin continues to attract stronger institutional interest, with Bitcoin ETFs garnering over $100 billion in assets, compared to Ethereum ETFs, which are under $10 billion .
Network Activity: Ethereum's on-chain activity has declined, with daily active addresses dropping and DApp usage decreasing by over 26% in recent months .
Supply Dynamics: Post-Dencun upgrade, Ethereum's supply has become inflationary due to reduced fee burns, reaching its highest level since May 2023 .
While the Pectra upgrade is a step towards future improvements, it hasn't immediately boosted ETH's price. Analysts suggest that Ethereum's recovery will depend on increased network activity, stronger institutional adoption, and further technical advancements.