Key Points
- Ethereum (ETH) has been criticized for underperforming compared to top rivals, including Bitcoin (BTC).
- A decline in Bitcoin dominance could be a catalyst for Ethereum’s potential growth.
Ethereum, the leading altcoin, has faced a wave of criticism due to its perceived lackluster performance. However, a shift in the dominance of Bitcoin could be the trigger for Ethereum’s growth.
Over this month, Ethereum’s market cap has seen an increase of approximately $100.61 billion from its lowest point. In contrast, Bitcoin’s market cap surged by over $480 billion in the same timeframe.
Comparing Performance
Ethereum’s performance has been measured against other top cryptocurrencies. For instance, its Total Value Locked (TVL) reached a high of $66.77 billion on November 12. Yet, this was still lower than its June TVL peak of $72.72 billion.
In terms of transaction data, Ethereum recorded a peak of 1.29 million transactions on November 12. Despite being the highest single-day transaction volume for the week, it was still lower than its peak daily transaction count in October, which stood at 1.32 million transactions.
Ethereum’s Potential Redemption
The dominance of Bitcoin has been on an upward trend, indicating that the majority of liquidity in the crypto market has been flowing into Bitcoin. However, this could change if Bitcoin’s dominance begins to decline.
Signs of a potential decline in Bitcoin dominance are emerging, primarily due to recent bearish divergence patterns with the Relative Strength Index (RSI). Moreover, the money flow indicator suggests that liquidity flows may be shifting in favor of altcoins.
There are indications that liquidity is already flowing into Ethereum. The gap between large holder inflows and outflows is expanding. On November 15, large holder inflows exceeded 488,000 ETH, while outflows were around 312,430 ETH.
This could suggest that Ethereum is gaining momentum as Bitcoin dominance starts to decline. No conclusions can be drawn at this stage, but the signs are promising for Ethereum’s potential growth.