- ETH is more sensitive to U.S. elections than BTC, per Bitwise’s CIO.
- The altcoin has been underperforming BTC since 2022; will the trend change?
According to Bitwise’s CIO Matt Hougan, Ethereum [ETH] has higher exposure to U.S. election outcomes than Bitcoin [BTC].
The executive noted that ETH has doubled BTC losses since Kamala Harris replaced Biden as the Democrat presidential candidate on the 21st of July. He said,
“Since Harris replaced Biden. BTC: -8.68%, ETH: -26.19%. Ethereum has more exposure to the election outcome than Bitcoin, in my opinion.”
Since Harris replaced Biden, ETH has dropped from $3.3K to below $2.5K. On the other hand, BTC dropped from above $68K to below $60K over the same period.
As such, ETH’s perceived high sensitivity to the changes could suggest that the outcome of the U.S. elections in November could impact the altcoin more than BTC.
ETH is ‘still great’
Additionally, between July and August, ETH lost significant market dominance as liquidity flowed to other competing assets like BTC and Solana [SOL].
According to market commentator Marty Party, this didn’t augur well for the largest altcoin.
Source: X
An evaluation of the ETHBTC ratio, which tracks ETH’s price performance relative to BTC, has been in a downtrend since late 2022. In short, ETH has been underperforming BTC for two years.
Unless the descending channel is broken, the ETH’s underperformance could extend.
Source: ETHBTC ratio, TradingView
However, Vitalik Buterin, Ethereum’s co-founder, maintained that ETH was still great despite the overwhelming weak market sentiment.
In a rebuttal against the notion that Solana had more developer count than ETH and would be the most preferred in the next 5 years, Buterin said,
“I like how the chart understates ethereum’s success by listing the L2s as separate categories, but even with that handicap ethereum still looks great 😂😂”
Source: X
In the meantime, ETH lost 8% of its value on Wednesday and slipped below $2.5K, erasing most of the August recovery gains. The altcoin had to reclaim the $2.5K for any possible recovery trend.