Ether (ETH) has seen a significant drop of 39% in value against bitcoin (BTC) this year, marking the lowest ratio between the two in almost five years. Currently, 1 ETH is equivalent to 0.02191 BTC, the lowest level since May 2020 when ether was trading around $200 and bitcoin was just under $10,000. As of now, ETH is priced at about $1,800 and BTC at around $82,000.
This underperformance of ether against bitcoin is particularly noteworthy as it comes in the 12 months following a BTC reward halving, which occurred on April 20, 2024. In previous halving cycles, ether typically outperformed bitcoin in the first year after the halving. However, this time, the ratio has dropped by over 50%, indicating a shift in market dynamics.
One of the contributing factors to this underperformance is the current macroeconomic environment, which is characterized by the threat of a tariff-driven trade war, persistent inflation, and elevated bond yields globally. In such uncertain times, investors tend to gravitate towards assets that are perceived as more liquid and less risky. Gold, for example, has reached record highs, and in the cryptocurrency market, bitcoin is seen as a safer investment compared to ether.
Data from Glassnode shows that this quarter marks one of ether’s worst performances against bitcoin in several years. The last time ether underperformed bitcoin to a similar extent was in the third quarter of 2019, when the ratio dropped to 0.0164, reflecting a decline of 46% for the quarter.
Moreover, ether’s relative weakness is further highlighted when compared to other layer-1 assets. The SOLETH ratio, which measures the value of Solana’s SOL relative to ether, has increased by 24% year-to-date to 0.07007. This indicates that SOL has significantly outperformed ether in 2025, despite SOL itself being down 35% year-to-date.
Overall, the current slump in ether’s value against bitcoin underscores the challenges facing the cryptocurrency in the current market environment. As investors navigate through a volatile macroeconomic landscape, the relative performance of different cryptocurrencies will continue to be closely watched for signs of market trends and investor sentiment.