The ETH/BTC exchange rate has declined by 37% since the Ethereum Merge on September 15, 2022, according to a recent market analysis by 10x Research. This notable shift reflects evolving dynamics between two of the largest cryptocurrencies by market capitalization and offers insights into both technical trends and broader macroeconomic influences shaping crypto markets in 2025.
Technical Trends in ETH/BTC Movement
Since the historic transition to proof-of-stake, the ETH/BTC ratio has been trading within a well-defined descending channel. Price action repeatedly met resistance near the upper boundary of this trendline, while finding support close to the lower edge. This pattern suggests sustained bearish pressure on Ethereum relative to Bitcoin over the past two years.
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Notably, a recent rebound in the ratio coincided with expectations around U.S. Consumer Price Index (CPI) data releases. Analysts believe this short-term uptick may have been driven by short covering—traders closing out bearish positions to lock in profits or limit losses during volatile periods. While such movements can signal temporary shifts in sentiment, they don’t necessarily indicate a long-term reversal in the trend.
Ethereum’s Ongoing Development Roadmap
Despite price fluctuations, Ethereum developers continue advancing a robust roadmap focused on scalability, usability, and network efficiency. One of the primary goals is achieving 100,000 transactions per second (TPS) through layer-2 scaling solutions and protocol enhancements.
A key innovation gaining traction is account abstraction, which enables smart contract wallets to function like traditional user accounts. This upgrade simplifies user experience by enabling features such as sponsored transactions (gasless interactions), batched operations, and improved security mechanisms. By lowering barriers to entry and reducing transaction costs, account abstraction aims to make Ethereum more accessible to mainstream users.
Another critical upgrade under development is single slot finality (SSF). Currently, Ethereum blocks achieve finality after approximately 6.4 minutes (or one epoch). With SSF, finality could occur within just 12 seconds—the duration of a single consensus slot. This dramatic improvement would enhance network responsiveness, reduce reorganization risks, and strengthen confidence in transaction immutability.
These upgrades follow previous milestones such as The Merge (transition from proof-of-work to proof-of-stake) and the Dencun upgrade (which introduced proto-danksharding via EIP-4844). While these events were pivotal for network security and scalability, their immediate impact on ETH’s price performance was limited.
Macroeconomic Drivers vs. Network Fundamentals
One of the central takeaways from 10x Research’s report is that Ethereum’s value—like most digital assets—is still heavily influenced by macroeconomic factors rather than technical advancements alone.
Inflation rates, interest rate policies, liquidity conditions, and risk appetite in traditional financial markets play a dominant role in determining crypto asset valuations. For example, tightening monetary policy tends to suppress speculative investments, including cryptocurrencies, regardless of underlying protocol improvements.
This dynamic explains why significant upgrades like the Merge did not trigger sustained price rallies. Investors remain sensitive to Federal Reserve decisions, bond yields, and global economic outlooks—factors that often outweigh even the most transformative blockchain innovations in the short term.
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Core Keywords and Market Implications
Key themes emerging from this analysis include:
- ETH/BTC ratio
- Ethereum Merge
- Account abstraction
- Single slot finality
- Blockchain scalability
- Crypto market trends
- Macroeconomic impact on crypto
These keywords reflect both technical developments and investor sentiment drivers that are crucial for understanding Ethereum’s current positioning in the broader digital asset ecosystem.
The sustained decline in the ETH/BTC ratio may suggest that Bitcoin is outperforming Ethereum in terms of investor preference during risk-off environments. However, with upcoming upgrades poised to enhance Ethereum’s utility and efficiency, long-term fundamentals remain strong.
Frequently Asked Questions
Q: What does a declining ETH/BTC ratio mean?
A: A falling ETH/BTC ratio indicates that Ethereum is losing value relative to Bitcoin. This could reflect stronger demand for BTC, weaker momentum for ETH, or broader market conditions favoring Bitcoin as a store of value.
Q: Did the Ethereum Merge significantly affect ETH's price?
A: Despite its technical importance, the Merge had limited immediate impact on ETH’s price. Broader macroeconomic factors such as inflation and interest rates have exerted greater influence on valuation.
Q: How will account abstraction improve Ethereum?
A: Account abstraction allows for smarter, more flexible wallet designs—enabling features like social recovery, gas sponsorship, and automated transactions—making Ethereum easier and safer to use for non-technical users.
Q: What is single slot finality and why does it matter?
A: Single slot finality refers to confirming a block as irreversible within one 12-second consensus slot. It would drastically speed up finality times, improve user experience, and increase network resilience against attacks.
Q: Can Ethereum reach 100,000 TPS?
A: Reaching 100,000 TPS will depend on the success of layer-2 rollups (like Optimism and Arbitrum) combined with protocol-level upgrades such as sharding and danksharding. While ambitious, this goal aligns with Ethereum’s long-term vision of global scalability.
Q: Is now a good time to buy ETH based on the ratio drop?
A: Price decisions should consider multiple factors including personal risk tolerance, investment horizon, and macro outlook. A lower ETH/BTC ratio might present a strategic entry point for some investors, but thorough research is essential.
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Conclusion
While the ETH/BTC ratio has fallen 37% since the Merge, Ethereum’s foundational progress remains strong. Technical upgrades like account abstraction and single slot finality are laying the groundwork for a more scalable, efficient, and user-friendly network. However, short-term price movements continue to be dominated by macroeconomic forces rather than on-chain achievements.
For investors and developers alike, understanding both layers—the technological roadmap and the economic environment—is key to navigating the next phase of Ethereum’s evolution. As the ecosystem matures, those who monitor both fundamentals and market sentiment will be best positioned to capitalize on future opportunities.