ETH/BTC Hits Its Lowest Level This Year as Bitcoin (BTC) Soars to a New All-Time High, Fueling Market Dominance Debates

Bitcoin (BTC) reached an all-time high of $97,862.64 (1 a.m. EST). At the same time, Ethereum (ETH) continues to lag behind

Bitcoin (BTC) price reached an all-time high on Wednesday, hitting $97,862.64 (1 a.m. EST), according to data from CoinMarketCap. At the same time, BTC’s rally has sparked debates over market dominance, as evidenced by a 3% increase in BTC’s share of the crypto market over the last month.

However, the performance of the second-largest cryptocurrency has fallen to the lowest levels this year when measured against Bitcoin. As of press time, BTC is trading at $97,379.69, with minimal price changes over the last 24 hours and a 70% year-to-date漲幅.

Bitcoin Dominance Rises

According to CoinMarketCap, BTC’s share of the crypto market has climbed to 60.5%, while ETH’s dominance has dropped to 11.8%, down from 13.8% last month. This marks a significant shift in market dynamics, with altcoins, including ETH, facing selling pressure as investors flock to Bitcoin.

Speaking on the matter, Edul Patel, CEO of Mudrex, stated the following during an interview with IndiaToday:

“Today, more institutional investors are investing in Bitcoin compared to before. The second factor was the political landscape, particularly Donald Trump, who became the President-elect of the United States. Donald Trump has had an impact, and it’s said that he revised his stance on cryptocurrencies, with Elon Musk acting as a crypto-positive representative.”

As institutional investors continue to drive up the demand for Bitcoin, altcoins, such as ETH, may face further challenges in regaining market share. Moreover, the ETH/BTC pair hitting a year-to-date low further upholds the notion that the second-largest cryptocurrency has not performed as well as BTC has this year.

Looking at ETH’s price chart for the year reveals that momentum has indeed fluctuated at critical resistance levels, but it still lags behind BTC’s upward trend. Such an observation is further supported by the M.A.C.D. indicator, which shows signs of weakness in ETH’s price action.

Meanwhile, the Altcoin Season Index, which currently scores 28, also shows that the market is not favoring altcoins. A drop in the market cap of altcoins compared to Bitcoin also indicates that liquidity is shifting from altcoins, including ETH, towards BTC.

Will Ethereum Pick the Pace Up?

The trajectory of ETH’s recovery both in terms of price and market dominance will depend on several fundamental and technical factors. While fundamental analysis shows the ongoing acceptance of Layer-2 solutions, development in decentralized finance, and active staking on Ethereum 2.0, technical analysis would indicate an initial level of support at 0.057 BTC, which could potentially act as a base.

Resistance levels are at 0.065 BTC and 0.070 BTC, which mark critical thresholds ETH needs to break if it is to regain momentum in its performance against Bitcoin. Closing the gap will require ETH to break above resistance levels and ride out ongoing network upgrades; such moves might help the ETH/BTC pair regain their lost ground against Bitcoin.