The ETH/BTC ratio reached its five-year low, with Ethereum lagging behind bitcoin in 85% of trading days. Concerns about the state of the Ethereum network and the growth of the second layers have increased. Transaction costs have reached their lowest level in two years.
Ethereum has performed weaker than bitcoin on 85% of trading days since its launch in 2015. The ETH/BTC ratio, which tracks the value of Ethereum relative to bitcoin, reached its five-year low of 0.018 on April 9. The last time this was down to this limit was in December 2019, when the price of Ethereum was 125 and the price of bitcoin was about 7,000.
Ethereum is now trading at about 1,670, according to CoinMarketCap. While bitcoin also fell, it fell only 6% to about 75,000,still 275% above its 2017 bull market peak, before climbing to more than 83,000 late in the day. By contrast, Ethereum has fallen below the peak of its market cycle in 2018. Analysts say this has virtually eliminated nearly seven years of relative Ethereum gains, putting most long-term holders in a position to lose.
Ethereum (ETH1,670) Performed better than bitcoin in the short periods between mid-2015 and mid-2017 and again in late 2019 and early 2020. Since then, bitcoin has consistently dominated the market. James Cheek, an analyst at Glassnode, noted that Ethereum has performed better than bitcoin in just 15% of trading days in its history.
Concerns about the current state of the Ethereum network are growing.
Concerns about the current state of the Ethereum network have begun to emerge. On April 8, Web3 researcher Stassi Moore noted that the number of active Ethereum addresses has remained almost constant for the past four years. He wrote on Platform X:
"I love Ethereum, but it's time to embrace reality: Ethereum has had the same approximate number of active addresses over the past 4 years.»
Others argue that user activity has shifted to second-tier Ethereum networks such as Arbitrum and Optimism. These platforms have experienced significant locked value overall, indicating that users are looking for cheaper and faster options within the Ethereum ecosystem. Data from L2beat confirm increased adoption of these scalability solutions.
Reduced transaction costs and criticism of the Ethereum network
Average Ethereum transaction costs have also fallen to 0.41, the lowest since late August. This significant decrease from the peak of 15.21 in the past two years shows that congestion in the network has decreased.
Nick Carter of Castle Island Ventures attributed the weakness of investment in Ethereum to the increase in second layers and the uncontrolled creation of tokens. He said the "pious second layers of Ethereum" had absorbed the activity without returning anything to the base layer and criticized the Ethereum community for allowing the platform to " be buried in the avalanche of its tokens.»
Kevin Thompson, founder of Lekker Capital, also stated that Ethereum is "completely dead" as an investment, citing declining transaction activity, weak user growth and declining network revenues.Carter had previously warned, back in September 2024, that Ethereum’s commission revenues had plummeted by 99% over the past six months. This sharp decline was mainly due to the rise of second-layer solutions, which began to take over both activity and revenue streams.
Please note: The information in this article is intended for informational and educational purposes only. It should not be considered financial, investment, or legal advice. Always do your own research and consult with a financial or legal advisor before making any investment decisions.
