Despite an apparent summer lull, Ethereum has taken advantage of the sunny days to get back into the bullish race on the cryptocurrency market. This momentum is currently allowing it to outperform Bitcoin on centralized exchanges (CEXs).
Ethereum surpasses Bitcoin on centralized exchanges (CEX)
Since the start of a significant bullish acceleration in the Bitcoin market at the end of last year, following the election of Donald Trump, Ethereum appeared to be conspicuously absent. Indeed, while BTC was reaching new highs, the price of ETH was unable to break through its previous record of 2021.
This lack of momentum was partly due to the strong popularity of Bitcoin since its high-profile arrival in traditional finance, with notable accelerations in the areas of spot ETFs, corporate treasuries, and other strategic government reserves.
Then the trend reversed at the end of August, when the Ethereum spot ETF market recorded higher inflows than Bitcoin over a full week. At the same time, Ether finally reached a new all-time high on August 24 at around $4,950.
This momentum appears to be continuing into September, according to data from analytics firm Kaiko. In fact, ETH’s spot market share on centralized platforms has just surpassed that of Bitcoin for the first time in the last five years.
A change in momentum for Ether
Some are already bringing up the possibility of a flippening with Bitcoin. In any case, Ethereum’s internal momentum also seems to be undergoing a major restructuring, due to its adoption by traditional finance players.
Indeed, the largest holders of ETH are no longer the individual whales who participated in its ICO. They are now staking contracts, centralized platforms, and funds, such as the spot ETF market. Even DeFi remains a small minority, with an estimated share of 1.3%.
This is because Ethereum’s real success at present lies in its associated staking option, which can increase the profits made from holding it. This added value is already widely used by corporate treasuries and is awaiting SEC approval for the Ethereum spot ETF market.
Bitcoin owes its success to its ability to establish itself as a safe haven. For Ethereum, the growing interest of traditional markets seems to be turning towards its ability to optimize ETH holdings, with cumulative returns. The question remains as to which formula will prove most popular.
