How to Switch Funds Between ETH and BTC? The Logic Behind Market Rotation

Wang Feng, the founder of Blue Harbor Interactive, recently analyzed the market performance of ETH and BTC on Twitter, making some very reasonable points:

Recently, ETH has been rising quickly, while BTC has been relatively flat. This is mainly a short-term phenomenon caused by different rhythms of capital and market narratives. ETH is actually more like a 'β amplifier' for BTC, helping to magnify market returns, but it is not meant to replace BTC. Historically, during the ICO boom in 2017 and the DeFi explosion in 2020, the strength of ETH actually enhanced BTC's safe-haven value. In other words, ETH acts like leverage, carrying higher risks but also greater rewards, while BTC serves as the market's 'anchor', being stable and value-preserving.

From a macro perspective, BTC and ETH share the same capital pool and policy dividends, with tightening but clear regulations, forming a solid foundation. In the short term, capital flows from BTC to ETH to earn excess returns, and it is very likely to flow back to BTC to cash out profits. This also means investors need to seize the window period of ETH to flexibly adjust their positions, but do not forget that BTC is the long-term safe haven.

In simple terms, in this round of market activity, ETH's short-term performance is striking, providing everyone with arbitrage opportunities, but funds will ultimately return to BTC to secure stable returns. Each has its positioning, and a smart investment strategy is to pay attention to both sides, utilizing rotation to capture profits while also keeping an eye on risk control.

This perspective helps us clarify the flow of market funds and investment logic, which is very helpful for understanding the value evolution of crypto assets.

The above content is for informational sharing only and does not constitute any investment advice! Follow me for more market insights shared daily. #ETH创历史新高