Ethereum (ETH) Loses Momentum as Solana (SOL) Surges on Trump's Memecoin Launch

The Ether-to-Bitcoin price ratio, a measure of the second-largest token's performance against the largest, dropped to its lowest level since 2021 on Monday

Ethereum's cryptocurrency, Ether, is continuing to lose steam against rival tokens, an occurrence that comes amid the fanfare over former President Donald Trump's entry into the speculative sector of the digital assets market.

The Ether-to-Bitcoin price ratio, a measure of the second-biggest token's performance against the largest, fell to its lowest since 2021 on Monday, showed an analysis of Bloomberg data.

Bitcoin hit a record high of $109,241 during the same period. Meanwhile, Solana's native token, a blockchain that rivals Ethereum, scaled new highs over the weekend.

Solana’s surge was largely driven by two memecoins that Trump and his wife Melania introduced on its blockchain in the lead-up to his second swearing-in. Trump's memecoin saw heavy trading activity over the weekend, reaching a market capitalization of $15 billion before a steep drop, according to CoinMarketCap.

Most major digital assets have benefited from the pro-crypto stance adopted by the Republicans since Trump's victory over Democrat Kamala Harris in November.

Memecoins, typically represented by jest tokens like Dogecoin, are volatile cryptocurrencies with little intrinsic value. They can record massive gains if they catch the attention of social media users but are also prone to crashing rapidly.

Solana, which styles itself as an "Ethereum killer," has become the network of choice for memecoin launches. The price ratio of its token to Ether hit a record high on Sunday as speculators piled into the Trump coins.

While other cryptocurrencies are scaling new records, Ether is still trading around 30% below its 2021 peak. The token has gained 39% over the past 12 months, compared to 156% and 180% gains for Bitcoin and Solana, respectively.

The relatively weaker demand for Ether has sparked concerns among investors. A group of 12 Bitcoin exchange-traded funds in the US saw a net inflow of over $17 billion, while similar Ether-investing products only attracted $3 billion in the past three months, according to Bloomberg.

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