The cryptocurrency market has witnessed diverging performances between its two largest assets, Bitcoin (BTC) and Ethereum (ETH). While Bitcoin has shown signs of recovery, gaining 3.8% over the past two weeks and reclaiming the $85,000 price level, Ethereum has struggled to keep up.
ETH remains below the $2,000 mark, a level it fell below last week, currently trading just above $1,900. The disparity in performance between Bitcoin and Ethereum has drawn attention from analysts, particularly regarding Ethereum’s declining strength against Bitcoin in the derivatives market.
Ethereum’s Decline Against Bitcoin: Key Market Trends
CryptoQuant analyst SunflowrQuant recently analyzed the ETH/BTC market trends, noting that Ethereum has weakened against Bitcoin over the past two years, reflecting a drop in investor confidence and reduced speculative interest in ETH derivatives.
According to SunflowrQuant, during the 2021-2022 period, Ethereum outperformed Bitcoin, signaling strong market interest and increasing activity in Ethereum-based derivatives at the time.
However, since then, the ETH/BTC ratio and open interest have both declined, suggesting that Ethereum has been losing ground against Bitcoin in terms of market dominance.
By March 2025, the open interest ratio of ETH futures had fallen to 0.15, while the ETH/BTC price ratio dropped to 0.02. This indicates that the bearish sentiment around Ethereum continues to dominate the market, as traders and investors shift their focus toward Bitcoin.
The declining open interest in Ethereum perpetual futures contracts further reinforces the idea that traders are showing less speculative interest in ETH compared to BTC.
What This Means for ETH’s Future
Despite ETH’s underperformance, SunflowrQuant suggests that its current weakness may also reflect broader market fear and uncertainty. The analyst points out that crypto markets are often driven by emotions, and when sentiment reaches an extreme low, a rapid recovery could follow.
Such low-liquidity conditions may lead to unexpected price movements, creating opportunities for ETH to regain strength in the ETH/BTC ratio. Historically, market downturns have been followed by periods of strong recovery, and Ethereum’s fundamentals remain intact. The analyst wrote:
Emotional fluctuations and market fear could lead investors to act more cautiously and strategically. We may be at the foundations of new beginnings for Ethereum; just like in previous cycles, after tough times, a strong rebound may occur, reaching new highs.
If investor confidence returns, ETH could potentially reverse its trend, similar to how it performed against Bitcoin in 2021-2022. However, this will likely depend on broader market dynamics, including institutional adoption, ETH’s network upgrades, and Bitcoin’s price stability. SunflowrQuant concluded:
Looking at the price fluctuations in Ethereum, now could be the perfect time to be part of this transformative process. We are at the bottom of potential new beginnings and opportunities for ETH.
Featured image created with DALL=E, Chart from TradingView