ETH Slumps to 20-Month Low Against Bitcoin (BTC) as the Market Awaits Trump's Memecoin

Ether (ETH) slumped Sunday to its lowest level against bitcoin (BTC) since March 2021 as the world's second-largest token extended losses against its larger rival.

The price of ether (ETH) relative to bitcoin (BTC) fell to its lowest level since March 2021 on Sunday, as the world’s second-largest cryptocurrency continued to lose ground against its dominant peer.

One ether was trading at 0.03 BTC on Sunday, down nearly 50% from a year earlier, as bitcoin rallied ahead of U.S. President Donald Trump's inauguration. The exchange rate between the two tokens, known as the ratio, peaked at over 0.08 in 2022.

ETH's value proposition has since come under pressure. Bitcoin hit a record high above $109,000 on Monday, up 160% over the past year. Ether, on the other hand, has risen only 40% and is still about 30% below its 2021 peak. Ether tends to rise when traders see value in the Ethereum blockchain, which was the first to offer smart contracts and decentralized finance (DeFi) applications. It weakens when they prefer bitcoin or other blockchains.

“Ethereum has notably underperformed this cycle, especially as Solana gains momentum through the memecoin craze and events like Trump's official memecoin launch on Solana rather than Ethereum,” Min Jung, an investment analyst at Presto Research, told CoinDesk via Telegram.

“However, World Liberty Financial's recent accumulation of $ETH shows that Ethereum still has a strong appeal to institutions. As the only cryptocurrency other than Bitcoin with an ETF, Ethereum is poised to become the next focal point after Bitcoin,” Jung added. World Liberty Financial is a crypto lending platform that Trump and his sons have promoted.

Bitcoin is not only hitting new lows against its top competitor in digital assets. It has also done the same against competing traditional assets. Bitcoin now costs 40 oz. of gold, or, equivalently, bitcoin's ratio to the gold market cap is now as high as 11.4%.