Originally published on: November 16, 2024
Ethereum, the second-largest cryptocurrency by market capitalization, is facing a tough time as its native token, Ether (ETH), breaks an 8-year trend against Bitcoin. Analysts are now suggesting that Ethereum may be “dying a slow death” due to recent developments.
The ETH/BTC pair recently dropped below a crucial support level that has held since 2016, signaling a significant shift in market dynamics. This break in the trendline support has led to a 15% decline in ETH/BTC, accompanied by a notable increase in trading volumes.
According to Tuur Demeester, founder of Bitcoin hedge fund Adamant Capital, “Ethereum is dying a slow death.” This sentiment is further supported by Ethereum’s underperformance compared to Bitcoin in 2024, as well as the rising popularity of competing smart contracts platforms like Solana.
The launch of Bitcoin exchange-traded funds (ETFs) in the US, coupled with Bitcoin’s halving in April, has diverted capital away from Ethereum and towards Bitcoin. Additionally, Ethereum missed out on key opportunities, like being considered as a strategic reserve asset by Donald Trump during his election campaign.
Technical charts suggest that ETH/BTC is entering a breakdown stage, following an inverse cup-and-handle pattern. If the current support level of 0.0317 BTC holds, there is a possibility of a rebound towards 0.043 BTC by the end of 2024. However, a breakdown scenario could see ETH/BTC plummeting to 0.017 BTC, down 50% from current levels.
It’s important to note that this article does not provide investment advice. Investors should conduct their own research and consider the risks before making any trading decisions.
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