Recently, Ethereum (ETH) has faced criticism for its perceived underperformance in comparison to Bitcoin (BTC), the leading cryptocurrency. However, the tide may be turning in favor of ETH, with one significant factor possibly being the changing dominance of Bitcoin.
While Bitcoin saw a staggering increase of over $480 billion in market capitalization during a recent period, Ethereum also experienced a notable rise of approximately $100.61 billion from its lowest point this month.
A key indicator of Ethereum’s perceived underperformance is its failure to achieve new All-Time Highs (ATHs), unlike some of its major competitors. For example, Ethereum’s Total Value Locked (TVL) reached $66.77 billion on November 12th, falling short of its peak in June at $72.72 billion.
Similarly, transaction data reveals a similar trend. Ethereum recorded 1.29 million on-chain transactions on November 12th, marking its highest daily transaction volume last week but still below its peak in October of 1.32 million transactions on October 18th.
Despite showing a bullish performance with a 44.61% increase from its recent low to high in November, Ethereum still lags behind Bitcoin, which has been making new price discoveries while ETH remains far from its all-time high.
Redemption for Ethereum
Bitcoin’s dominance in the market has been growing consistently, indicating that the majority of investment inflows have been directed towards BTC. However, this trend could shift if Bitcoin’s dominance begins to decline.
There are early signs that Bitcoin’s dominance might be starting to wane, with recent downside movements and bearish divergence patterns in the Relative Strength Index (RSI). Additionally, the money flow indicator suggests that liquidity may be shifting towards altcoins.
Ethereum appears to be benefiting from this potential shift, as evidenced by the increasing gap between large holder inflows and outflows. On November 15th, large holder inflows exceeded 488,000 ETH, while outflows amounted to 312,430 ETH during the same trading session.
These developments hint at Ethereum gaining momentum, especially if Bitcoin’s dominance continues to decline, potentially putting ETH back in the spotlight in the cryptocurrency market.