Bitcoin vs Ethereum in terms of their performance since the approval of January’s ETF has been quite a topic of discussion lately. Despite sharing a positive correlation with BTC, ETH has faced challenges since January.
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Bitcoin vs Ethereum
Ethereum has underperformed BTC since January, as per Glassnode’s report. BTC, aided by US spot ETFs, has seen significant capital inflows, while ETH has recorded a decline in trading activity.
Following the approval of spot Bitcoin ETFs on January 10th, Glassnode data shows a significant divergence in Net Unrealized Profit/Loss (NUPL) between BTC and ETH. This suggests that BTC’s investors have captured a larger share of profits compared to ETH’s investors since then.
NUPL Metric
The NUPL metric compares the average purchase price of all tokens held by investors to the current market price. A value exceeding 0.5 indicates that an asset’s unrealized profit is greater than 50% of its total market capitalization.
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Glassnode stated, “Amidst the hype and market rally surrounding the approval of the spot Bitcoin ETFs, the unrealized profit of Bitcoin holders expanded considerably faster than that of Ethereum investors. As a result, the Bitcoin NUPL metric crossed 0.5 and entered the euphoria phase three months earlier than the equivalent metric for Ethereum.”
https://twitter.com/glassnode/status/1786422090276499675
Strong Inflow of New Capital
ETH has yet to see a strong inflow of new capital as BTC has since spot ETFs became tradeable in the US. Glassnode assessed the Short-Term Holders’ Realized Cap for both coins and found that ETH’s remains low, suggesting reduced activity from short-term investors, who significantly influence an asset’s price performance.
Long Term Holders
Due to the difference in the performance of the coins, BTC and ETH’s long-term holders (LTHs) have adopted different strategies. While BTC’s LTHs have sold some holdings to book profits following the rally, ETH’s LTHs “appear to still be waiting for better profit-taking opportunities.”
Conclusion
To conclude, Bitcoin vs Ethereum, the performance divergence between these two since the approval of January’s ETF reflects varying investor sentiments and capital flows. While Bitcoin has seen significant gains and investor profit-taking, Ethereum has faced challenges with reduced trading activity and a slower influx of new capital. The upcoming decision on ETH ETFs by the SEC could potentially reshape Ethereum’s trajectory in the market.
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