Ethereum’s Hidden Struggles: Will It Rise Again or Continue Its Descent Against Bitcoin?

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Since Ethereum’s transition to a proof-of-stake system with the Merge in September 2022, the network has faced numerous challenges, with its native cryptocurrency, Ether (ETH), losing significant value compared to Bitcoin (BTC). Since the Merge, Bitcoin has risen by approximately 160% against Ether, raising concerns about Ethereum’s market position and future price potential.

The Merge was designed to improve energy efficiency and introduce a deflationary model by reducing Ethereum’s supply over time. Initially, there was optimism that Ethereum might surpass Bitcoin in terms of market capitalization. However, the anticipated benefits have not materialized as expected. By February 2025, Ethereum’s supply growth rate was nearly stagnant at 0%, contrary to the reduction goals set during the Merge.


Ethereum’s deflationary efforts, powered by EIP-1559, have been undermined by a decline in onchain activity and gas fees, leading to fewer Ether burns. Data shows a sharp drop in average transaction fees from above $15 in March 2024 to below $5, indicating reduced network demand and a subsequent increase in Ether supply.

Moreover, key long-term holders of Ethereum have significantly reduced their holdings since the Merge. Data reveals a decrease in large holdings by wallets with over 100,000 ETH and even larger reductions in holdings by those with 1 million ETH. This trend contrasts with Bitcoin, which has seen a substantial increase in large wallet holdings.

As Ethereum struggles, Solana and other ecosystems have gained market share, attracting decentralized finance (DeFi) and non-fungible token (NFT) projects. Solana, in particular, has seen notable growth, commanding a significant portion of the decentralized exchange market.

Despite Ethereum co-founder Joseph Lubin’s suggestions that market cycles and whale activities are normal, traders remain cautious. Ethereum’s price relative to Bitcoin is increasingly vulnerable whenever Bitcoin achieves new highs.

The current technical indicators suggest that Ethereum’s ETH/BTC trading pair might experience a relief rally in the coming weeks. However, if it fails to hold key support levels, further declines are possible, potentially testing lower support levels established during earlier periods of market stress. The outlook for Ethereum hinges on its ability to rebound in market demand and attract more blockchain activity.