Here’re the reasons why Ethereum price has been underperforming in the market
According to Hal Press, founder of North Rock LP, Ethereum has weak market performance and good foundations.
Not because of Shanghai imo. It’s *because* ethereum fundamentals have been so strong consistently over last year. ETH never “capitulated”, so it’s gonna underperform everything that did on the bounce from lows. Also this dynamic: little new money coming into crypto. /1
— Ari Paul ⛓️ (@AriDavidPaul) February 28, 2023
Real Reason Behind Ethereum’s Underperformance Explained by Analyst
According to Press’s tweets, Ethereum’s ecosystem is still thriving and developers are working at an exceptionally high level, but it is one of the worst performers because of the “overhang” in Shanghai, which he thinks is unsustainable.
Ari Paul, the managing partner and chief information officer of BlockTower Capital, has a different viewpoint on this. Since Ethereum never “capitulated,” he thinks its underperformance over the past year resulted from solid fundamentals.
Because of this, Ethereum has been unable to keep up with other cryptocurrencies that have recovered from their lows. Paul also notes that it is challenging for large-cap cryptocurrencies like Ethereum to see a significant rally due to the nature of the current market.
Little rotating flows within the cryptocurrency industry can treble the value of currencies with a market worth of up to $5 billion with little fresh capital entering the industry. However, these coins can also fall as much as 80% with equal ease.
The full shift to a proof-of-stake network is anticipated with Ethereum’s Shanghai upgrade, allowing validators to withdraw rewards earned from adding or validating blocks to the blockchain. Although it is predicted that this would be a good development for the Ethereum network, it is unclear whether it will substantially affect the performance of the cryptocurrency market.
Investors and traders will need to keep a close eye on Ethereum’s market performance and market circumstances because the cryptocurrency market continues to be unpredictably volatile.
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