Ethereum’s (ETH) price has been trailing behind Bitcoin’s gains in 2024, but analysts from Glassnode suggest that brighter days could be on the horizon for the popular cryptocurrency.
According to data from TradingView, Ethereum has been underperforming compared to Bitcoin over the past two years. This has resulted in a weaker ETH/BTC ratio, which hit a low of $0.04622 on May 1, 2024, the lowest level since April 2021.
Glassnode attributed Ethereum’s underperformance relative to Bitcoin to a “measurable lag in speculative interest” from the Short-Term Holder (STH) investor cohort. This group comprises investors who acquired their coins within the last 155 days and are often seen as a proxy for new investor demand.
The report highlighted that while Bitcoin experienced a significant increase in speculative activity leading up to its all-time highs in March, Ethereum has not seen a similar surge.
Glassnode’s analysis of on-chain data indicates that Bitcoin’s STH-Realized Cap is nearly at the same level as the peak of the last bull run, while ETH’s STH-Realized Cap is still less than half of previous cycle levels.
“In many ways, this lack of new capital inflows is a reflection of the under-performance of ETH relative to BTC,” the Glassnode analysts claimed in the report.
This lack of new capital inflows into Ethereum is seen as a reflection of its underperformance relative to Bitcoin. However, Glassnode believes that the market is still in the “early stages of a macro uptrend.”
This prediction was based on the Net Unrealized Profit/Loss (NUPL) metric, which, according to the analytics platform, measures the profit or loss investors could have if they sold their investment right now compared to the profit or loss they actually made when they sold it before.
According to Glassnode, both Ethereum and Bitcoin are still at the beginning of a tNUPL trend of rising prices, suggesting that prices could continue rising in the future.
Historically, Ether’s price performance has been closely linked to Bitcoin’s price movements and capital inflows into Ethereum tend to lag behind those into Bitcoin. Despite experiencing a sell-off after the fourth halving, both cryptocurrencies have shown resilience, with relatively shallow corrections so far.=
According to the latest data from TradingView, Bitcoin is currently trading at $62,492.65, while Ethereum is at $3,008.39.
Disclaimer: This piece is intended solely for informational purposes and should not be considered trading or investment advice. Nothing herein should be construed as financial, legal, or tax advice. Trading or investing in cryptocurrencies carries a considerable risk of financial loss. Always conduct due diligence.
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