Why Ethereum is down 7% while Bitcoin’s price is gaining

Why Ethereum is down 7% while Bitcoin’s price is gaining
Snapshot
Bitcoin is brushing close to $70,000, but Ether is still far away from its all-time high. Illustration: Gwen P
By
Ben Weiss
28 October 2024 at 13:53
  • Bitcoin and Solana are outperforming Ether.
  • The two biggest cryptocurrencies have historically moved in tandem.
  • Here’s what’s going on.

The world’s two largest cryptocurrencies usually rise and fall in tandem.

However, over the past week, Ether has dropped 7% to $2,525 and Bitcoin has stayed relatively flat at $68,957, according to CoinGecko.

“While ETH has at times outperformed BTC, this cycle we have seen nothing of the sort,” Ben Caselin, chief marketing officer at the crypto exchange VALR, told DL News.

Bitcoin and Solana’s skyrocketing prices have been bolstered by the launch of spot Bitcoin exchange-traded funds and the ongoing memecoin frenzy.

And the recent discrepancy between Bitcoin and Ethereum continues a decoupling that occurred after Ethereum ETFs went live in July.

Since then, Ether has declined 36%, whereas Bitcoin has increased 2%.

While many celebrated the long-awaited launch of the financial instruments, which allow retail investors to buy and sell Ether through brokerage accounts, the ETFs haven’t seen nearly the same inflows as spot Bitcoin ETFs.

Since July, spot Ether ETFs have seen a net outflow of more than $504 million, according to data from SoSo Value.

Join the community to get our latest stories and updates

Meanwhile, spot Bitcoin ETFs have seen a total inflow of almost $22 billion since their launch in January.

“Regulators and traditional investors are showing more openness to BTC, but not quite the same for ETH — at least, not yet,” Shauli Rejwan, managing partner at Masterkey.VC, told DL News.

Moon or doom?

Ether’s recent losses mirror the rise of other layer 1 protocols like Solana, whose cryptocurrency is up almost 7% over the past seven days, Caselin said.

“There is no guarantee that Ethereum will have long-lasting staying power at the top,” he added.

However, he said, in the coming weeks, Ethereum’s price may rise.

“The upcoming US elections might bring volatility back to the market, which may bode well for Ethereum over the short-term, but such events can also serve for exit liquidity,” he said.

Rejwan struck a more optimistic note. Given how recently spot Ether ETFs launched, he said it’s still too early to count the cryptocurrency out.

“We’ll start seeing Wall Street interest materialise in roughly six to 10 months,” he said, “or maybe the bull run will accelerate their decision.”

Crypto market movers

  • Bitcoin is up 2.1% over the past 24 hours to trade at $68,957.
  • Ethereum is down 1.9% to trade at $2,525.

What we’re reading