In what is certainly a surprising development, Ethereum has underperformed Bitcoin 44% since its proof of stake (PoS) switch. The data was shared by digital asset analytics firm CryptoQuant. Moreover, they note that it could be set to experience even greater declines.
The two assets are firmly established as the market’s top two. Yet, the distance between them seems to be growing. Still, both BTC and ETh are the only two crypto-based ETFs in the United States. With the latter’s underwhelming performance, it could stay that way for the foreseeable future.
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ETH Notably Underperforming BTC Since PoS Switch
Amid an overall bear market, few cryptocurrencies have thrived this summer. Ethereum stands out as an asset that has severely underperformed recently. Although it is only down 1% in the last 30 days, it has lost 6% of its value in the last week alone, according to CoinMarketCap.
That looks to be a microcosm of greater troubles for the second-largest crypto. According to CryptoQuant data, Ethereum has underperformed Bitcoin by 44% since ETH’s proof of stake switch. Indeed, it has failed to live up to expectations after it made the switch two years ago.
Source: Betanews.com
Also Read: Ripple to Add Ethereum Smart Contracts to its XRP Ledger
“Next week will mark two years since Ethereum switched to a proof-of-stake network, an upgrade now as The Merge,” CryptoQuant analysts told The Block. “Since then, Ethereum had underperformed Bitcoin by 44%.”
Yet, that isn’t the only asset it has performed poorly against. “Ethereum has also underperformed altcoins like Solana and BNB since ‘The Merge,’ down 53% and 18%, respectively,” the firm’s Head of Research Julio Morean said.
“Ethereum could fall further with respect to Bitcoin as Ether is still above undervaluation territory,” they added. “We estimate that Ether would need to fall about 0.02 in term so fBitcoin, a 50% decline, for it to enter undervaluation territory.” According to analysts, the key reason for the drop is the “weaker network activity,” when compared to BTC.
