• The exchange rate between Bitcoin (BTC) and Ether (ETH) has been falling rapidly in recent weeks.
• Financial instability is disproportionately benefiting Bitcoin, as investors flock to the digital currency as a safe haven asset.
• Ethereum can also make the claim to be robust and decentralized, but it hasn’t been able to keep pace with Bitcoin’s price gains.
Dropping ETH/BTC Exchange Rate
The exchange rate between Bitcoin (BTC), the world’s first and largest cryptocurrency by market capitalization, and Ether (ETH), the world’s second-largest cryptocurrency by market capitalization that powers the Ethereum blockchain, has fallen rapidly in recent weeks.ETH/BTC was last changing hands on Binance (as per TradingView) around 0.0625, down around 15% from earlier monthly highs in the 0.0735 area and at its lowest level since July 2022.
Bitcoin Outperforming Other Cryptocurrencies
ETH/BTC’s downside isn’t a result of Ether performing poorly. On the contrary, at current levels in the $1,750s, Ether is up just shy of 10% this month and is up over 27% versus earlier monthly lows under $1,400.The problem for Ether is that it, like most other cryptocurrencies, hasn’t been able to keep pace with Bitcoin. Bitcoin has been leading a charge higher in cryptocurrency markets amid what analysts have referred to as a “safe haven” bid as cracks form in the global banking system.
Financial Stability Concerns Benefit Bitcoin
After three major regional US banks went under earlier this month, Credit Suisse was bought out by Swiss rival UBS over the weekend. Meanwhile, a consortium of US banks came together last week to provide a $30 billion bailout for US bank First Republic.Despite efforts from authorities to calm the situation, investors remain on edge that more banks might be about to go under and so they are turning towards assets like gold or digital currencies such as Bitcoin which are viewed as safe havens; helping propel its value higher than most other cryptos like Ethereum which cannot compete with its gains lately despite its own robustness and decentralisation claims.
Bitcoin Viewed As “Digital Gold”
Gold formed the bedrock of most civilizations’ financial systems for thousands of years hence when troubles arise investors often turn back towards gold which many view as ultimate haven however recently bitcoin which many refer to as ‘digital gold’ is increasingly being seen as an alternative safe haven asset too due to its highly robust structure & decentralised payment system that operates entirely separate from traditional financial system unlike ethereum or other cryptocurrencies .
Ether Still Has Advantages Over BTC
While ether may not have kept up with bitcoin’s price surge it still maintains advantages over it such independent decentralized finance ecosystem which can be built directly on top plus its smart programmability goes beyond bitcoin capabilities therefore although currently ether may not be doing very well compared with bitcoin it still provides certain unique features that could turn out beneficial long term should crypto markets continue their upward trend .