Ethereum's native token, Ether (ETH), has fallen to its lowest level against Bitcoin (BTC) since May 2020, with analysts warning that further declines may lie ahead. The ETH/BTC pair dropped more than 1.50% on March 13, reaching 0.022 and signaling a continuation of a multi-year downtrend.
The current decline represents an 85% drop from Ethereum's record high of 0.156 established in June 2017. Technical indicators paint a bleak picture for the second-largest cryptocurrency by market capitalization. On the two-week chart, Ethereum's relative strength index (RSI) has plummeted to an unprecedented low of 23.32, well below the 30-point threshold typically indicating oversold conditions.
Crypto analyst Alessandro Ottaviani has described the situation as a "falling knife" scenario – market terminology for an asset experiencing rapid, steep decline that often warns buyers against premature purchases. "A falling knife implies that attempting to catch the asset at a perceived low could lead to further losses if the downtrend persists," Ottaviani noted.
For any potential reversal, traders are watching for stabilization of the RSI and reclamation of key resistance levels. The critical starting point would be a rebound from the current 0.022 BTC level – a support that previously limited downside in December 2020 and preceded a 300% rally.
Should such a rebound materialize, technical analysis suggests the ETH/BTC pair could rally toward the 0.382 Fibonacci retracement line at approximately 0.038 BTC, which aligns with the 50-week exponential moving average.
Until then, the technical outlook indicates Ethereum could remain trapped in its downward trajectory. Analysts have identified potential support levels in the 0.020-0.016 BTC range, with the lower bound representing a further 30% decline from current levels.
Ethereum's declining performance against Bitcoin extends beyond technical factors. The blockchain now faces robust competition from rival networks, particularly Solana (SOL). Data from investment firm VanEck shows Solana's decentralized exchange volume has surpassed Ethereum's, even during a steep decline in memecoin trading activity. Meanwhile, Solana's trading volume has consistently increased in recent months, corresponding with Ethereum's declining volumes.
The introduction of spot Bitcoin ETFs has fundamentally altered traditional crypto market cycles that previously benefited Ethereum and other alternative cryptocurrencies. Historically, capital rotated into altcoins after Bitcoin surged following halving events, triggering an "altseason" where ETH typically outperformed BTC. However, the $129 billion in inflows to Bitcoin ETFs in 2024 has disrupted this pattern, redirecting liquidity from the broader altcoin market, including Ethereum.
Additional selling pressure has come from Ethereum-specific events. The recent Bybit hack reportedly led to substantial ETH liquidations, with some value laundered through decentralized platforms like Thorchain. Market analysts believe these liquidations continue to reverberate through the market, further depressing Ethereum's relative value.
Without significant fundamental or technical changes, market observers expect ETH/BTC's bearish trend to continue in the near term, potentially testing lower support levels as Bitcoin maintains its dominant position in the cryptocurrency landscape.