ETH breaks out against Bitcoin – what’s next for Ethereum after 100% profit in January?

The price of Ether (ETH), the native cryptocurrency of the Ethereum blockchain network, hit a new all-time high on January 25th.

At the same time, the technical analysis shows that the ETH / BTC pair is breaking out of its multi-year downtrend and is reaching its highest levels since September 2019, which should be good news for altcoins in general.

Weekly candle chart from ETH / BTC (Coinbase). Source: trade view

The higher highs come less than a week after ETH / USD finally crossed its all-time high and topped $ 1,400 for the first time in three years.

The mood in the community is extremely positive

The sentiment around Ethereum has become clearly positive after the ETH managed to break its record price set in January 2018.

Anthony Sassano, a longtime Ethereum investor and marketing director at Set Protocol, said the rally is representative of the foundations developers have made in the Ethereum ecosystem over the past three years.

ETH and BTC since the beginning of the year. Source: Digital Assets Data

During the 2019 bear cycle, ETH was hit hardest among other large capitalization cryptocurrencies. It consistently underperformed BTC and tried to gain upside momentum.

However, the newfound momentum resulting from the increasing demand for DeFi has allowed ETH to outperform Bitcoin in the recent bull cycle. Sassano said:

“That may be hard to believe, but the main reason I get so dizzy that the price of ETH goes up is not because of the profits. It is the fact that so many dedicated members of the Ethereum community built for three long years during a brutal bear market. And now your work is rewarded. “

On-chain data shows a similar trend, along with numerous other indicators that suggest the ETH price rally may only be beginning.

According to researchers at Santiment, the development activity on Ethereum, for example, was similar to the ETH price.

Ethereum price versus Github activity. Source: Santiment

This trend shows that the ongoing ETH rally is being led by strong fundamentals and high developer activity, which makes it more sustainable. The researchers said:

“Both #Bitcoin and #Ethereum dominated each other here in January. We just noticed that each project’s #Github development activity rate fluctuates greatly depending on the price of $ BTC and $ ETH. “

What happens next?

After the rally, analysts say the momentum of ETH and the network effect of the Ethereum network show that it is a blue chip asset in the cryptocurrency market.

Alex Saunders, a cryptocurrency investor, said most agreed on the characteristics of Ethereum as a blue-chip asset. He said:

“Two years ago, ETH fell 90% in 9 months, reaching $ 80. Most had written it off. But here we are at a new ATH $ 1500, the network effects are undeniable and most agree that it is a blue chip. Love it.”

Ethereum weekly price chart. Source:, Alex Saunders

There are two scenarios for ETH in the foreseeable future. The price of ETH could rise after the CME futures listing in February due to large institutional capital inflows.

On the other hand, after breaking its all-time high, ETH could also retreat as the momentum of the ETH / BTC pair cools. For example, the pair pulled back on Jan. 21, shortly after Ether broke its all-time high in the USD pair.

It can be assumed that the Bitcoin dominance index will recover after a two-month altcoin season, which could lead to a consolidation phase for ETH in the short term.