The Ether-Bitcoin Trading Relationship

Figure 1: ETH-BTC correlation has been more consistently positive since early 2018

Figure 2: ETH has been more volatile than either BTC or the ETHBTC exchange rate

Figure 3: From 2017-2020 BTC often ran ahead of ETH but that seems to have stopped in 2021

Figure 4: ETHBTC had large swings until 2021 when it settled into a narrower range

Macroeconomic and Market Factors

Figure 5: Higher tech stocks tend to boost ETHBTC while a higher USD tends to depress it

Figure 6: The Total Number of Ether coins grew until the switch from PoW to PoS

The Economics of Ethereum Supply

Figure 7: Up until the 2022 switch to PoS, ETH new coin supply large reacted to ETHBTC

Bitcoin’s economics appears to drive the exchange rate

Figure 8: Bitcoin supply is perfectly inelastic, which contributes to its high volatility.

Figure 9: Miners’ revenue and prices have tended to peak before halvings, followed by declines

Figure 10: Transactions per day may be a proxy for demand and a harbinger of price moves