Ethereum's Price Rally Faces Challenges Despite Institutional Adoption

According to Cointelegraph, the Ether-Bitcoin (ETH/BTC) ratio, which tracks the price of Ether (ETH) relative to Bitcoin (BTC), has struggled to surpass the 0.05 mark. This is despite significant institutional adoption of ETH and a historic price surge in July and August that propelled Ether to new all-time highs. Since July 2024, the ETH/BTC ratio has remained below 0.05, with its peak recorded in June 2017 at an all-time high of 0.14, as per CoinGecko data. Currently, the ratio stands at 0.039, a slight decline from the 0.04 level reached in August. The ratio experienced a significant drop to a five-year low of 0.02 in March, amid macroeconomic uncertainties and escalating trade tensions between the United States and its trading partners. However, the cryptocurrency market has since rebounded, with Ether's price reaching a series of highs in August. On August 24, Ether hit an all-time high of $4,957 before experiencing a 6.7% decline to its current price level. Since July, Ether's price has surged by approximately 155%, driven by financial institutions adopting the token for treasury purposes, traditional equity investors acquiring ETH through exchange-traded funds (ETFs), and the Ethereum Foundation's efforts to engage Wall Street. Despite these gains, Ether has only outperformed Bitcoin 15% of the time since its launch in 2015, according to market analyst James Check. Most of Ether's outperformance occurred between 2015 and 2017, following the launch of the world's first smart contract blockchain platform and the initial coin offering (ICO) boom of 2017. Since 2020, Bitcoin has generally outperformed Ether, as highlighted by Check's price history analysis shared in April. Market analysts are speculating on when Ethereum will reach the $5,000 milestone, which it narrowly missed in August by approximately $43 before retracing to current levels. Jake Kennis, an analyst at blockchain analytics and research company Nansen, commented during the August rally that with ETH near its previous all-time highs, a period of consolidation might occur due to the rapid price increase over a short timeframe. Kennis suggested that it could take weeks or months for ETH to achieve new all-time highs following the intense price rally in August.