Chart of Ethereum “disastrous” — and the ETH/BTC ratio just confirmed it

Ethereum’s L1 dominance is still intact, even as Solana continues to gain ground and BTC/ETH ratio falls below 0.022.

ETH/BTC reaches a record low

EthereumETH), the world’s second-largest crypto by market capThe reality of’s situation is a sobering one. The ETH/BTC rate, a metric that is used to measure Ethereum’s relative strength to Bitcoin.BTCThe price of Ethereum (ETH) has fallen to its lowest point since December 2020. This is a sign that Ethereum’s performance relative has been deteriorating.

Ethereum’s value has dropped by more than 73% in comparison to Bitcoin since September 2022. As this article is being written, ETH has a value of around $1.880. It’s down 9% from last week. And it’s down 62% since its peak of $4.890, in November of 2021.

Ethereum is four times more volatile than Bitcoin. Bitcoin has declined by just 10% in the last year and is trading at $84,300. Ethereum is down 46%.

Ethereum is losing its dominance over the smart contract ecosystem and layer 1, a market it dominated unchallenged.

Other L1s such as SolanaSOLBinance ChainBNB), Avalanche (AVAXEthereum is gaining ground as Bitcoin asserts itself.

We’ll take a look at the reasons behind this disparity, whether Ethereum really is losing ground and what that means for the L1’s future. blockchain race.

Ethereum metrics are showing signs of a softening

Ethereum’s value has increased by 14% as of April 1. 1, Ethereum’s total value locked Approximately $50.5 billion represents 52.5% market share. The market share has dropped from 61.64% to $50.5 billion in just two years.

A large part of the shift in this market can be traced back to Solana’s TVL, which increased substantially. Solana has seen its share grow from 2.84% up to 7.24%. This brings their total TVL of $6.69 Billion, which is a more than 2.5x increase in less than one year.

A new emerging trend in the user behaviour is that of different networks. Ethereum continues to draw users engaged in passive DeFi activity, such as harvest farming. staking.

Solana, on the other hand, is attracting more active and speculative traders. This is especially true for meme tokens, as well as high-frequency deFi. It is possible that Ethereum’s current use cases are not aligned to where users’ activity has been trending.

Gas prices, which were historically Ethereum’s greatest barrier, are now lower. Gas prices have dropped by 1.12 cents on average GWEI Significantly, in March 2025. lower The levels are higher than in the previous years.

Ethereum is still relatively slow and expensive compared with newer chains. This is especially true for smaller transaction users.

Amidst this, Bitcoin ETFs Net inflows of more than 36 billion dollars have been recorded to date. Ethereum ETFs The ETH ETFs have been unable to attract attention. Net total flows to ETH ETFs dropped by 9.8% in March 2025. dropping The total amount is $2.43 billion.

The sentiment towards Ethereum on the trading front appears to be declining. According to Kobeissi Letters, the short position in Ethereum has increased by over 500% from November 2024.

Ethereum’s market share has dropped to its lowest point in four years. Milocredit, a cryptocurrency mortgage company, pointed out that this indicates that money is moving away from ETH to other platforms, such as Bitcoin, Solana and the emerging layer-1 platforms, which are taking advantage of Ethereum’s slowed growth.

The trade-offs between scalability and performance are becoming more common.

Since years, the growth story of Ethereum has been based on scaling. This promise has not been fulfilled in the core layer as early as 2025. Ethereum’s Mainnet is still processing only 10 to 60 transactions per second, despite several protocol upgrades.

The effective throughput of this device hovers around around 16 transactions per second—a figure that stands in stark Solana has 4,322 TPS in comparison. The fact that users are building elsewhere is a major reason for the shift.

In 2022, the Merge will transition Ethereum to proof-of stake. This change is expected to improve energy efficiency by over 95%. It did not, however, resolve the core network throughput issues. 

Ethereum relies more and more on layer-2 rollups, such as Arbitrum.ARB), Optimism (OP“, and Base Scaling its operations. These networks expand Ethereum’s capability by processing transactions on-chain, and settling the transaction back to mainnet. 

L-2 adoption, while lowering user costs has had unintended effects. The mainnet of Ethereum is losing users, and the transaction fee structure has shifted to L-2. 

One user of X pointed out, “Arbitrum and Optimism are raking in fees… while Ethereum’s base layer is turning into a ghost town.”

The data supports the trend. Analysts like Geoff Kendrick at Standard Chartered argue The L2, particularly those with high transaction volumes like Coinbase Base, siphon off billions of dollars in transaction fees otherwise payable flow Ethereum mainnet is the only way to access it.

Kendrick believes that Base has diverted economic activity to the point where it’s estimated Base is responsible for around $50 billion of value being removed from Ethereum. The amount of ETH that is burned by gas fees will be reduced, a factor which weakens the narrative about ETH’s deflationary mechanism. “ultrasound money.”

Ethereum’s fee burn mechanism was to be used as a counter-balance for issuance after EIP-1559. Due to the fragmentation of activity across hundreds of sidechains and rollups now, fee burns are down significantly.

ETH is once again a leader in the ETH industry become Net inflationary is now 0.5% per annum. Staking yields are now below 2.5%. This makes ETH look less appealing when compared with stablecoins that offer returns over 4.5% on DeFi platforms.

Even Ethereum’s upcoming upgrade, Pectra — designed to improve L2 efficiency by increasing blob capacity from three to six for data availability won’t do much.

Kendrick stated that he did not expect Pectra will reverse the broader ETH/BTC drop, calling it insufficient to resolve Ethereum’s underlying structure issues.

The activity on Ethereum’s mainnet seems to have dried up. Gas usage is now dominated by bots, notably address poisoning robots. Less organic applications are deployed directly on the mainnet.

One user said, “ETH mainnet is becoming a graveyard.” Ethereum core layer’s reputation is fading.

Ethereum price predictions: Are we at the bottom?

Several market analyst signals point out a variety of outcomes. However, the downside risks for ETH appear to stack up faster than any potential upside.

Ethereum is still heavily linked to the risk assets environment on the macro level. Bloomberg strategist Mike McGlone said that “ETH remains closely correlated with risk assets,” Meaning its performance will likely reflect the U.S. equity markets and sectors with high beta.

Stock markets will decline even further by 2025, especially under. weight Ethereum may be under increased pressure due to high interest rates or persistent inflation.

McGlone has warned that ETH is at risk of deteriorating in a deteriorating macro-environment. “potentially revisit the $1,000 level,” This would be a reduction of almost 50 percent compared to current levels.

The price structure also shows signs of stress from a technical perspective. The analyst Mags noted that Ethereum had “one of the worst charts of all time,” This cycle has seen a number of attempts to breach the resistance level of $4,000 fail.

After three unsuccessful attempts, ETH failed not only to regain its previous highs but lost support on its mid-range and also fell below a upwards-sloping tendencyline that held steady since the last market bottom.

This type of breakdown, combined with the lack of strong support below current levels, opens the possibility of a retest near the $1,060 range — a price last seen during the 2022 bear market. Mags pointed out, “technically speaking, the bearish scenario looks more likely.”

However, a more optimistic perspective came from trader Michaël van de Poppe, who observed that Ethereum may be showing early signs of a potential “deviation.”

He believes that if ETH is able to break through the zone of $2,100-2,150, it will cause a sudden move upwards to $2800. This would indicate renewed strength on the market.

The recent drop in the U.S. Dollar Index was also highlighted as a positive macro-signal, suggesting that an ailing dollar could support a cryptocurrency rebound in Q2.

These scenarios are still bullish, but they depend on Ethereum returning to key technical levels as well as a more favorable market sentiment. The downside risks are more obvious until then.

Ethereum’s path appears to be closely related, in the short run, to Bitcoin’s current positioning and macroeconomic cycles. If Ethereum makes a significant move over $2,150 it could signal the beginning of a new phase. This is not likely to happen, but the structural and technical pressure will continue.

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