Financial analysts note that in recent days Ethereum (ETH) has been noticeably outperforming bitcoin (BTC). Many experts consider ETH “the backbone of the crypto-native economy” and the most popular means of transactions. Thus, multinational bank and asset manager JPMorgan confirms that this trend is gaining ground. According to analysts at JPMorgan, Ethereum’s tendency to outperform bitcoin is likely to continue in the long run. They highlighted three main factors for ETH’s further uptrend. First of all, Ethereum shows more resilience in terms of liquidity compared to bitcoin. In the last week of April, both cryptocurrencies faced a steep decline, with bitcoin posting more losses than ether. BTC futures were affected the most compared to ETH. Analysts stress that after the liquidity shock both currencies had experienced, Ethereum recovered much quicker, and liquidity conditions on some exchanges are even better than prior to the event. The second reason that JPMorgan points out is Ethereum’s relatively low reliance on derivatives markets. Experts explain that in the market with high spot turnover the underlying base of long exposure in ETH is less reliant on leverage in the form of futures and swaps than BTC. According to analysts at JPMorgan, the third reason that helps Ethereum overtake bitcoin is its higher pace of transactions. This is explained by traders’ increased activity on DeFi and other platforms. Besides, a higher proportion of ether tokens supports its liquidity that has grown by 11% over the past month compared to 4% in bitcoin.
