Analyzing Ethereum’s (ETH) Performance Dip Compared to Bitcoin (BTC): Insights from Glassnode

  • Market intelligence firm Glassnode has reported that Ethereum (ETH) has been lagging behind Bitcoin (BTC) due to a lack of increased capital from new buyers.
  • The firm suggests that the approval of spot Bitcoin exchange-traded funds (ETFs) was a key driver for the increase in short-term holders who bought BTC in the last 155 days.
  • There is speculation that ETH could see a large capital inflow if the U.S. Securities and Exchange Commission (SEC) approves spot Ethereum ETF applications later this month.

Market intelligence firm Glassnode has reported that Ethereum (ETH) has been lagging behind Bitcoin (BTC) due to a lack of increased capital from new buyers. The firm suggests that the approval of spot Bitcoin exchange-traded funds (ETFs) was a key driver for the increase in short-term holders who bought BTC in the last 155 days.

Bitcoin’s Rise and Ethereum’s Lag

According to Glassnode, Bitcoin’s rise to new all-time highs in the current market cycle was driven by an increase in capital from new buyers. This trend, however, has not been mirrored by Ethereum. The analysis revealed that while Bitcoin’s short-term holder realized cap is nearly on par with the last bull run peak, Ethereum’s has barely lifted off the lows. This suggests a lackluster inflow of new capital and reflects the underperformance of ETH relative to BTC.

Role of Bitcoin ETFs

The approval of spot Bitcoin ETFs played a significant role in attracting new capital. Glassnode noted a noticeable increase in speculative activity in the run-up to Bitcoin’s all-time high on March 14th. The USD wealth held within coins moved within the last six months approached $240 billion, near all-time highs. The analysts suggest that the attention and access brought about by the spot Bitcoin ETFs contributed to this trend.

Potential Boost for Ethereum

Despite the current lag, Ethereum could see a large capital inflow if the U.S. Securities and Exchange Commission (SEC) approves spot Ethereum ETF applications later this month. The market is eagerly awaiting the SEC’s decision, which is expected towards the end of May. If approved, this could potentially boost Ethereum’s performance and attract new capital inflows.

Conclusion

In conclusion, while Ethereum has been lagging behind Bitcoin in terms of attracting new capital, the potential approval of spot Ethereum ETFs could change the game. It remains to be seen how the SEC’s decision will impact Ethereum’s performance in the coming months.

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