NAIROBI (CoinChapter.com) — Ethereum (ETH) has attracted strong criticism from skeptics, questioning its potential to recapture Bitcoin’s dominance. While Ethereum remains the second-largest cryptocurrency by market capitalization, its performance this cycle has been disappointing, fueling doubts about its long-term strength.

Ethereum (ETH) Oversold Amid Bullish Divergence

Ethereum’s struggle against Bitcoin is reflected in the ETH/BTC ratio. Currently, the ratio is 0.68 times its June 2022 value, reflecting Ethereum’s continued underperformance in this cycle. This is different from past market patterns, in which Ethereum often outperformed Bitcoin shortly after the cycle low.

Technical trader Scott Melker pointed out Ethereum's oversold conditions on the weekly chart. He pointed out a rare bullish divergence in the relative strength index (RSI). While Melker believes this could spark a short-term rebound, the decline in ETH/BTC shows doubts that Ethereum can achieve any meaningful recovery.

Ethereum is trading 70% below its all-time high, while Bitcoin recently hit $80,000. Critics say this highlights deeper problems compared to Solana, which has staged a strong recovery after steep losses.

According to data from Santiment, there has been a significant increase in activity by large shareholders, driving Ethereum’s transaction volume to $10.4 billion.

Uncertainty looms over Ethereum’s path forward

On-chain data reveals some similarities between Ethereum's current cycle and previous cycles, but its performance is still lagging. Since January 2022, the ETH/BTC ratio has fallen by 60%, which is smaller than the 86% drop at the same stage of the previous cycle. However, the lack of a solid recovery has made many investors doubt Ethereum's ability to regain momentum.

Cameron Winklevoss pointed out the growing institutional interest in this bull run, which could play a role in Ethereum’s future. On the other hand, CryptoQuant CEO Ki Young Ju warned that the futures market appears to be overheated and could cause problems in 2025.

The ETH/BTC ratio typically drops three to six months after Bitcoin’s halving, before quickly rebounding. Analyst Charting Guy pointed to a fractal that suggests this pattern could repeat, hinting at a possible rebound for Ethereum.

This view is supported by on-chain analyst JR, who cites the realized value versus investor value (AVIV) indicator as a sign of a potential reversal.

Ethereum’s struggles against Bitcoin have drawn criticism, but historical data and technical signals suggest a recovery could be on the horizon. Whether its bear market resilience will lead to a lasting comeback, however, remains uncertain.