Glassnode, the onchain analytics firm, has published a comprehensive report that examines the contrasting performance of bitcoin and ethereum during the 2023-24 cycle. The report highlights bitcoin’s resilience and ethereum’s struggles in terms of speculative interest and price performance.
Glassnode researchers have observed a significant divergence in the performance of bitcoin (BTC) and ethereum (ETH), with BTC demonstrating greater resilience. According to the latest onchain report from Glassnode, “Ethereum’s under-performance relative to bitcoin in this cycle is evident in the lag in speculative interest from short-term holders.” This divergence has been attributed to a weaker trend of capital rotation for ether compared to previous cycles.
The report further reveals that the fourth Bitcoin halving initially triggered a sell-off, causing BTC prices to drop to $57,000 before recovering. Glassnode stated, “From the all-time high of $73,000, bitcoin prices corrected by -20.3%, marking the deepest correction on a closing basis since the FTX lows in November 2022.” In contrast, ether experienced a similar drop but suffered a maximum drawdown twice as severe as BTC.
Despite the initial sell-off, both BTC and ETH showed signs of recovery. However, ethereum’s price performance continued to lag behind that of bitcoin. The researchers noted, “We continue to observe HODLing behavior among ethereum holders, particularly in the 1 to 3-year cohorts,” indicating a cautious approach from experienced holders due to ETH’s current under-performance.
Investor behavior also differed between the two assets. Bitcoin’s net unrealized profit/loss (NUPL) metric entered the euphoria phase three months earlier than ethereum’s, reflecting a quicker expansion of unrealized profits among bitcoin holders. Glassnode’s analysis suggests that the discrepancy in performance and investor sentiment is likely influenced by the approval of spot bitcoin exchange-traded funds (ETFs), which has not yet been extended to ethereum.
To read Glassnode’s complete study, click here.
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