Bitwise: Ethereum is in "one of the most severely undervalued areas in years."
ChainCatcher news, analysts from the cryptocurrency asset management company Bitwise stated in a report that Ethereum has reached "one of the most severely undervalued areas in years."According to data from CoinGecko, as of the time of writing, the ETH/BTC exchange rate has dropped by 47% over the past 12 months. However, Andre Dragosch, Head of Research at Bitwise Europe, believes that Ethereum's pricing is "fundamentally wrong in relation to on-chain activity and adoption metrics."The growing interest in artificial intelligence, meme coins, and RWA tokenization is considered to be the reason for ETH's poor performance. The report states: "These areas benefit from lower transaction costs, while Ethereum's often congested and expensive network is at a disadvantage."Dragosch added that the rise of L2 scaling solutions "has dispersed activity across multiple ecosystems, limiting the value that the Ethereum base layer can directly capture." Worse still, ETH "is widely used as a trading pair across the entire crypto ecosystem, making it susceptible to ongoing downward pressure from arbitrage when prices rise."Additionally, Bitwise noted that historical data suggests ETH may "see a rebound in February," as over the past eight years, ETH has gained positive returns relative to BTC in seven of those years.
