Ethereum’s Post-Merge Struggle Continues
As the second anniversary of Ethereum’s transition to a proof-of-stake (PoS) network approaches, the cryptocurrency’s performance continues to lag behind Bitcoin. According to CryptoQuant’s analysis, Ethereum has underperformed Bitcoin by a significant 44% since the Merge.
Analysts attribute this underperformance to a combination of weakening network activity and increased supply. Despite the approval of a spot Ethereum ETF in the United States, ETH/BTC exchange rates have remained at a multi-year low, currently hovering around 0.0425.
Julio Moreno, head of research at CryptoQuant, noted that Ethereum has also fallen short of other altcoins like Solana and BNB, lagging by 53% and 18%, respectively. However, CryptoQuant analysts believe that Ethereum is still not undervalued, estimating that it would need to drop by around 50% to reach the undervalued zone.
Supply dynamics also play a role in Ethereum’s price performance. Since the Dencun upgrade in April, Ethereum’s total supply has been steadily increasing, reaching its highest level since May. This growing supply can put downward pressure on prices.
As Ethereum continues to evolve and adapt to the changing landscape of the cryptocurrency market, it remains to be seen whether it can overcome these challenges and regain its position as a dominant player in the industry.
