The Bitcoin halving is now behind us, and we can focus on understanding the effects it will also have on other cryptocurrencies. Specifically, in today's article, we want to explore the impacts on the second most capitalized coin, ETH, by also analyzing past cycles.

The ETH/BTC Chart

The most crucial indicator that allows us to analyze ETH's relative strength against BTC, the leading cryptocurrency, is undoubtedly the ETH/BTC chart, where these two coins are compared.

Unfortunately, the historical data is not yet very extensive, but it allows us to examine how Ether has performed relative to BTC over the last two cycles.

Our first observation is that, since its inception, ETH has shown a positive trend against BTC, which means it is generally gaining value compared to this coin.

Another observation is that, at least in the last two cycles, ETH has demonstrated relative strength especially in the first months after the halving event, while the second half of the cycle has always been weaker and characterized by "retracement."

Of course, no one can predict what will happen in the newly started cycle, but if history repeats itself, we might see an increase in ETH's value compared to BTC in the coming months.

Bitcoin and Ethereum Dominance 

In the cryptocurrency sector, "dominance" typically refers to the share of the total market capitalization that a specific cryptocurrency holds compared to the combined market capitalization of all cryptocurrencies. 

This metric is very important to analyze because it shows the strength or the weakness of a coin relative to the general market.

Let's start analyzing Bitcoin's dominance and how it has evolved over the years. Here, we see a clear downward trend, that means that year after year, different altcoins, especially ETH, increase their market share at the expense of BTC.

At the time of writing this article, BTC's dominance within the crypto market is 53.9%. In comparison, four years ago, during the period of the third halving, Bitcoin had a dominance of 65%.

Moreover, this has increased in recent months, in the pre-halving period, as this is historically it’s a challenging time for all the altcoins that suffer in both price and dominance terms.

However, as we analyzed in a previous article, right from the first months after the halving, altcoins, especially ETH, have historically found much more strength compared to Bitcoin, which has always caused a decrease in BTC's dominance.

Now let's see how ETH's dominance has evolved over the years.

Unlike BTC's dominance chart, ETH's shows an upward trend, which means that the importance and value of ETH are increasing over the years.

At the time of writing this article, ETH's dominance stands at 16%, but it has reached peaks of over 30% during the 2017 ICO period.

As we were saying before, this increase in ETH dominance is one of the reasons for the BTC decrease in the dominance and market share.

ETH Price in the Last Cycles

Over the years, ETH has always shown incredible performance, and the percentage results speak for themselves.

During the last cycle, from 2020 to 2024, ETH reported a performance of +1325%, and again, we can see that the rise occurred especially in the first half of the cycle, which we have come to call the bull market.

Even the previous cycle, from 2016 to 2020, reported incredible performance, with a +1771% increase, and here too, the rise occurred mainly in the early stages of the cycle.

Obviously, the future cannot be predicted in this case, but thanks to MetalSwap, one can expose themselves to the price of ETH, even with positions with very long time frames and without paying any funding rate.

To do this, just go to the official dApp and select the blockchain to operate on between Ethereum, Optimism and Linea. Then select the reference asset, in this case, ETH, and the characteristics of this operation, including target size, time frame and cover.

When all is set, just click “CREATE” and enjoy your position.

For a step-by-step guide on how to open a position on MetalSwap, you can refer to this section of the docs or this Youtube video.

-The DeFi Foundation

✎ What is MetalSwap?

MetalSwap is a decentralized platform that allows Hedging Contract on financial markets with the aim of providing coverage to those who work with Digital Asset and an investment opportunity for those who contribute to increase the shared liquidity of the project. Allowing the protection for an increasing number of operators.

With Hedging Contract we enable hedge swap transactions through the use of Smart Contracts, AMM style.

It's great to Hedge the Risk of Price volatility with MetalSwap dApp !