Ethereum Underperforming, Don’t Blame The Network Or Leadership: Here’s Why

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As a seasoned analyst with over two decades of experience in the financial markets, I have witnessed numerous cycles of boom and bust, bull runs and bear markets. Having closely followed Ethereum since its inception, I find myself intrigued by its current predicament.

In this current bullish market, Ethereum appears to be lagging behind compared to Bitcoin. While Bitcoin reached new record highs above $70,000 in March, Ethereum had difficulty surpassing $4,000. When it finally managed to do so, its performance was lackluster, only briefly testing $4,100 before experiencing a significant drop.

Over the last seven months, following Ethereum reaching record highs in 2024, it has dropped by close to 40%. Given its recent trends, there’s growing apprehension that Ethereum could experience further declines. If it doesn’t manage to surpass $3,000 in the upcoming trading periods, this pessimistic outlook might prove accurate.

Don’t Blame Ethereum Or Its Leaders For ETH’s Underperformance

Speaking with one expert, it’s suggested that Ethereum (ETH) may be lagging behind Bitcoin, Solana, and even Tron. This isn’t due to the design of the network or its management in his opinion, but rather on the performance over the past seven months which he attributes to investors who are not well-informed.

It’s true that following the price peak in March, Vitalik Buterin and the Ethereum Foundation have been selling some of their Ethereum holdings. As reported by Dune Analytics, these transfers have been happening consistently.

On September 6th, they transferred approximately 1,000 Ether when the price was around $2,300 per coin, with the majority of these ETH being sent to exchanges for conversion into cash. It’s worth noting that while Buterin occasionally sells ETH, he has been actively selling meme coins and contributing substantial sums to numerous charities worldwide.

Typically, when a high-ranking executive or organization decides to offload their shares, it could indicate a bearish outlook. Yet, based on the analysis, their activities – such as those aimed at enhancing the network – are not cause for significant alarm.

ETH To Be A Better Store Of Value Than Bitcoin For Growth?

 

The analyst at X believes ETH is decreasing due to investors not fully understanding the project’s inherent advantages. Crucially, they argue that ETH has potential as a superior form of value storage compared to gold. However, it should be noted that Ethereum and Bitcoin are often in competition, and denying this is an error. Ultimately, both networks aim to establish their dominance within the marketplace.

To date, Bitcoin holds the highest value among all cryptocurrencies. However, when it comes to the most active smart contract platform, Ethereum outshines Bitcoin due to its greater versatility and a more robust ecosystem, making it richer in functionality compared to the initial blockchain.

To make Ethereum (ETH) more robust, it’s crucial for it to excel in its role as a valuable asset compared to Bitcoin. This can be achieved by building a robust supply system and prioritizing finance as a major application. Once these improvements are in place, ETH will become increasingly appealing not just for investors but also developers.

Currently, Ethereum is gaining momentum, with ETH exhibiting net deflation since the implementation of EIP-1559 and aligning with the principles of UltraSound Money. Simultaneously, its roll-up ecosystem is flourishing, enhancing mainnet scalability. In the long run, these factors could potentially boost Ethereum’s value, driving up its appraisal.

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2024-10-26 08:46