Ethereum Price Prediction: Bitcoin Dominance Impact

Ethereum (ETH) price has surged 300% since its 2022 cycle low of $880, yet it’s trailing Bitcoin (BTC) by a staggering margin.

Data from Glassnode shows the ETH/BTC ratio has declined steadily since mid-2022, signaling Bitcoin’s dominance in this cycle.

While ETH trades at $3,107 as of Feb. 2 as per Coingecko data, analysts question why the second-largest crypto struggles to keep pace despite bullish fundamentals.

BTC Vs. ETH: A 2.5-Year Dominance Streak

Bitcoin’s institutional tailwinds are widening the gap. The SEC approved spot Bitcoin ETFs in January 2024, six months ahead of Ethereum’s pending applications.

This regulatory head start fueled BTC’s 160% year-to-date rally in 2024, while ETH rose 90% in the same period.

The ETH/BTC ratio, which measures Ethereum’s performance against Bitcoin, has trended downward for 30 consecutive months.

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A falling ratio indicates Bitcoin’s outperformance. Analysts highlight Bitcoin’s first-mover advantage in institutional adoption, including potential inclusion on the U.S. government’s balance sheet.

Ethereum’s Quiet Strengths: TVL and Adoption Hopes

Ethereum remains the backbone of decentralized finance (DeFi), hosting 58% of all blockchain Total Value Locked (TVL) at $43 billion, according to analyst @puntium.

Its network supports stablecoins, meme coins NFTs, and layer-2 scaling solutions.

However, experts warn competitors like Solana and Avalanche are “catching up in fees, staking, and use cases.”

For ETH price to reverse its downtrend, experts call for public and private sector partnerships, particularly in the U.S., where regulatory clarity lags behind Bitcoin’s progress.

Ethereum Price Prediction and Technical Analysis

Ethereum faces immediate technical hurdles. On Feb. 2, ETH dipped 4% to $3,068 before recovering to $3,107.

Crypto trader Cas Abbé Ethereum price prediction shows ETH must reclaim $3,400 to confirm a bullish reversal toward $4,000.

The 100-day moving average ($3,300) and a bullish flag’s upper boundary ($3,400) form a critical resistance zone.

A breakout above $3,240 could trigger over $1 billion in short liquidations, per CoinGlass data.

However, ETH’s failure to hold $3,500 on Feb. 1 led to a retracement, raising concerns of a “false breakout.”

Binance liquidation heatmaps reveal a cluster of short-position liquidations near $3,500.

This liquidity pocket could attract ETH’s price as traders target stop-losses. A clean break above this level might propel ETH toward $4,000, but weak momentum risks a drop back to $3,000 support.

Ethereum’s 300% rebound since 2022 isn’t trivial, but Bitcoin’s ETF-driven rally and institutional momentum overshadow it.

For ETH to flip the script, analysts say real-world adoption – not just DeFi dominance – is critical.

Until then, the ETH/BTC ratio’s downward trend may continue, testing the patience of even the most steadfast holders.