Ethereum’s dominance in the cryptocurrency world is under scrutiny as its market performance lags behind, but can it reassert a leadership position?
Is ETH Still Special?
ETH‘s woes are news to few in the industry, but for us as index and product builders for ‘5%-ers,’ it begs the question: is ETH still special? A distinguished provenance can only take you so far. ETH continues to dominate its on-chain categories (even before adding in L2s) and is arguably the second best brand name in crypto.
There are even thoughtful ideas about ETH‘s end-state as an essential supporting component of our blockchain future; we hear expressions like, ‘Ethereum will be the clearinghouse of DeFi.‘ However, mainstream adoption requires a growth story. We have observed over the last few weeks that bitcoin has shown impressive resilience to fragile global markets.
This past week was no exception, and as we pointed out last week, expectations for higher inflation – now echoed by Fed Chair Powell – could help support movement into bitcoin. But the crypto market’s dependency on bitcoin to lead prices higher is one we hope the digital asset class outgrows. ETH can reassert a leadership position, as it briefly did in the weeks following the U.S. election.
Bitcoin is a decentralized digital currency that allows for peer-to-peer transactions without the need for intermediaries.
It was created in 2009 by an anonymous individual or group using the pseudonym Satoshi Nakamoto.
Bitcoin operates on a decentralized network of computers, allowing for secure and transparent transactions.
The total supply of bitcoin is capped at 21 million, with new coins being created through a process called mining.
If not, CoinDesk 20 investors have exposure to much of ETH‘s competition. As of April 20, 2025, ETH sits in 16th place in the CoinDesk 20 YTD performance leaderboard, down 53%. Going back a year, the numbers look similar: 15th place and down 50%. Its market cap has dwindled so much relative to XRP that both are expected to be capped in the upcoming CoinDesk 20 reconstitution, a first.
The Case for ETH’s Dominance
ETH‘s dominance in its on-chain categories is undeniable. It continues to be the second best brand name in crypto and has thoughtful ideas about its end-state as an essential supporting component of our blockchain future. However, this does not necessarily translate to mainstream adoption.
Bitcoin‘s Resilience and ETH’s Challenges
The recent resilience of bitcoin in fragile global markets is a positive sign for the digital asset class. Expectations for higher inflation – now echoed by Fed Chair Powell – could help support movement into bitcoin. In contrast, ETH has struggled to find its footing this year, sitting in 16th place in the CoinDesk 20 YTD performance leaderboard and down 53%.
The Future of ETH
ETH can reassert a leadership position if it can break free from its dependency on bitcoin. A growth story is necessary for mainstream adoption. If not, investors have exposure to much of ETH‘s competition. The future of ETH remains uncertain, but one thing is clear: it cannot rely solely on its past successes to drive its future growth.
About the Author
Andy Baehr leads research and product development of digital asset indices and strategies at CoinDesk Indices, bringing twenty-five years of global markets and investment management experience to help improve crypto trading and investing for everyone.
- coindesk.com | Is ETH Still Special?
