Ethereum Gains Momentum Over Bitcoin
Ethereum (ETH) is increasingly outperforming Bitcoin (BTC) in both spot and derivative markets, according to Bybit’s November 2024 “Volatility Review.” Co-authored by Block Scholes, the report highlights a notable shift in investor sentiment favoring Ethereum, particularly after the United States presidential election on Nov. 5.
Bybit notes that Ethereum gained significant traction against Bitcoin, as evidenced by a sharp increase in the ETH/BTC price ratio. The report further cites growing demand for ETH options, which reflects traders’ increasing preference for Ethereum over Bitcoin.
Impact of SEC Chair’s Resignation on Ethereum’s Momentum
Ethereum’s outperformance gained additional momentum following the announcement of U.S. Securities and Exchange Commission (SEC) Chair Gary Gensler’s resignation on Nov. 21. This development not only attracted investor attention but also contributed to sustained growth in ETH’s market dominance.
Since the announcement, the ETH/BTC ratio has climbed from 0.0325 to over 0.04, marking a significant shift in the market.
Is Altseason Underway?
The rising prominence of Ethereum has sparked discussions about a potential “altseason.” Bybit highlights ETH’s growing dominance in the spot market, while CoinShares’ digital asset fund flows report for the week of Nov. 26 reinforces this trend.
Bitcoin funds experienced outflows of $457 million, while Ethereum funds recorded inflows of $634 million, signaling a pivot in investor interest. Bitcoin’s market dominance has since fallen from 58% on Nov. 21 to less than 52% as of Dec. 6, further underscoring the shifting dynamics in the cryptocurrency space.
Expecting Volatility in Ethereum
Bybit anticipates heightened volatility for Ethereum in the coming weeks. The report notes a surge in ETH options market activity, reflecting stronger demand for Ethereum’s price optionality compared to Bitcoin.
Bybit emphasized that Ethereum’s historically high correlation with Bitcoin is accompanied by significantly larger volatility. This trend is considered a return to typical market behavior rather than an anomaly.
