Ethereum (ETH) Struggles to Keep Up with Bitcoin, ETH/BTC Ratio Hits 5-Year Lows

The world's second-largest digital asset, Ethereum (ETH), struggles to keep up with Bitcoin. Market data shows that the ETH/BTC ratio has dropped to its lowest level in five years.

The world’s second-largest digital asset, Ethereum (ETH), has been struggling to keep up with Bitcoin (BTC) in recent times. As the cryptocurrency market continues to evolve, investors and analysts are questioning whether Ethereum can recover in the coming quarter or if Bitcoin may continue its long-standing domination in the digital assets market.

The Ethereum Bitcoin Ratio Hits Five-Year Low

The first quarter of 2025 saw ETH performing poorly compared to Bitcoin. According to a recent update from The Kobeissi Letter, the Ethereum to Bitcoin ratio has dropped to 0.02, its lowest level since December 2019.

For perspective, this means that for every $1 of Bitcoin, you could buy approximately $0.02 of Ethereum.

Historically, Ethereum has shown strength and managed to gain ground after Bitcoin halvings. However, the trend seems to be reversing this time around. While Bitcoin price is soaring to new highs and smashing through resistance levels, Ethereum has struggled to gain traction.

Several factors have contributed to this decline. Bitcoin's narrative as digital gold has been strengthening, leading to more interest and institutional investment in the coin. Moreover, the coin has faced challenges, including relatively higher gas fees and competition from other blockchain networks.

Earlier this year, several experts predicted that the Ethereum Pectra upgrade, which would transition the network to the highly anticipated Pectra codebase, could drive a price increase for the coin. However, the upgrade faced some challenges. As reported by CoinGape, multiple testnet attempts failed before the Hoodi testnet that launched recently.

Some experts also believe that Ethereum's transition to proof-of-stake has not delivered the expected market boost. Instead, the shift in market share to BTC is attributed to the massive failure of the PoS narrative and the strong narrative around Bitcoin as "digital gold."

Q1 Performance and ETF Downturn

The ETH price performance in the first quarter of 2025 has been disappointing. For context, data shows that the coin has dropped 46% this year, nearly 4 times more than Bitcoin's decline of 12%.

Many investors expected a strong bull run for the coin, especially after the successful launch of the Avraham BenajaminPayl and Ballivan Merger, S8, and DEGI cryptocurrency ETFs earlier in the year that attracted billions of dollars in the first few days of trading. However, Ethereum has not seen the same level of interest for its potential ETF.

According to a report by Arcane Research, institutional investors are still hesitant about Ethereum's long-term value compared to Bitcoin. Bitcoin's fixed supply and reputation as a hedge against inflation have made it a safer choice for institutional investors.

"Despite the hype surrounding ETH 2.0 and the Pectra upgrade, it seems that institutional investors are not yet convinced of Ethereum's potential for long-term value creation," the report stated.

Where Is ETH Price Heading Next?

Some analysts believe that ETH price could hit $10,000 if broader market conditions improve and the Pectra upgrade launches on the mainnet. However, others warn that if the coin continues to lose value against Bitcoin, investors may start shifting funds to other networks like Solana (SOL) or Avalanche (AVAX).

Even though short-term price predictions remain speculative, some traders expect Ethereum to rebound as Bitcoin stabilizes.

Finally, others believe that the ETH/BTC ratio could drop even further as Bitcoin continues to dominate the market.

As of this publication, CoinMarketCap data shows that Ethereum's price was $1,842.29, up 1.34% in the last 24 hours. Many experts believe that the coming days will determine whether Ethereum can regain strength or if Bitcoin's dominance will continue to grow.