Ethereum
Ethereum’s Underperformance Against Bitcoin, Solana Means It ‘Will Need More Demand Sources,’ Trader Says
May 14, 2024 10:47 a.m. | 2 minutes of reading
Pseudonymous trader Evanss6 shared his thoughts on Ethereum (CRYPTO: ETH) recent underperformance, the challenges it faces on multiple fronts, and the potential catalysts that could boost it future growth and adoption.
What happened: The trader recognizes Ethereum’s poor trading performance over the past year, with a local high compared to the Bitcoin (CRYPTO: BTC) trading pair that occurred around the merger in late 2022. Over the past year, ETH has accumulated 62% gains, compared to 130% for Bitcoin and by Solana (CRYPTO: GROUND) 600%.
Despite the favorable supply dynamics resulting from the triple halving, the trader attributes ETH’s underperformance to a less favorable imbalance between buyers and sellers compared to competitors like BTC and SOL.
The merchant points It was highlighted that Ethereum was a highly consensus position at the time of the merger, with widespread ownership and usage across various crypto sectors. However, since then, Ethereum has lost ground on three fronts: competition from Bitcoin, Solana, and regulatory challenges.
The True Acceptance of Bitcoin Trafficking, Solana’s Coin Frenzy
Bitcoin gained real acceptance from TradFi through ETF approval, took shares of NFTs via ordinals, and grew its “L2” ecosystem.
Solana, on the other hand, has already taken the worst into account, taken in various measures, and has become the leading platform for coin exchange, and has reached consensus status. “Solana is now the consensus. That doesn’t mean it’s bad. It’s just not going against the grain like it used to be around $10 to $30,” says Evanss6, adding that he plans to continue to hold SOL in first position until he sees a reason. not.
Regulatory challenges
Ethereum faces challenges as the SEC investigates Its security status, the market has factored in the spot approval of the ETH ETF, and the Biden administration’s stance on stablecoins and crypto appears unfavorable.
Evanss6 highlights several positive developments for Ethereum despite the challenges it faces.
The need for Ethereum
The trader believes that Ethereum will need more sources of demand, with the ETF a major step towards unlocking new capital flows. He highlighted the importance of L1’s continued optimizations and a consistent narrative around “programmable money” and “institutional grade tokenization platform.”
And after: The influence of Bitcoin as an institutional asset class should be explored in depth in the next The future of digital assets event on November 19. Read next: Why Grayscale Could Be the Spark ETH Needs: 10x Research
This content was partially produced using AI tools and was reviewed and published by Benzinga editors.
Image created using artificial intelligence with Midjourney.
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