The narrative surrounding Ether (ETH<\/a>) of it fast transforming into an independent asset has been around for some time now. However, the last few months have seen this notion gain an increasing amount of mainstream traction, as is best highlighted<\/a> by the fact that, since Oct. 1, ETH has showcased substantial northbound movement against Bitcoin (BTC<\/a>).\u00a0<\/p>\n To put things into perspective, toward the beginning of November, the one-month realized correlation between the BTC\/ETH pair dipped<\/a> as low as 60%, its lowest ever in the currency\u2019s decade-old history. Furthermore, since the start of the year, while Bitcoin registered gains of 105%, Ether went up by a whopping 505%, thus outperforming the flagship crypto by nearly five times.<\/p>\n Ether gaining an upper hand is perhaps best reflected in that, over the course of the last couple of months, the ETH\/BTC pair has continued to trend north, despite there being a major market dip across the board since the start of December. In this regard, even when the value of BTC fell back below $50K, the ETH\/BTC pair price continued to accrue value<\/a>, quickly rising by around 13%, thus hitting a three-year high.<\/p>\n Speaking with Binance’s research wing, a spokesperson for the cryptocurrency exchange told Cointelegraph that the above stated activity \u2014 wherein ETH has been able to muster a lot of independent market support against Bitcoin \u2014 has been quite unusual considering that the ETH\/BTC pair tends to only rally during bull runs, adding: \u201cThis is not to say that ETH has already decoupled from BTC, but it provides a clear-cut glimpse that not all alts are correlated to BTC movements.\u201d The spokesperson further elaborated:<\/p>\n \u201cIt\u2019s important to acknowledge that ETH may no longer be considered as an alt, but it\u2019s a token with its unique characteristics. The key drivers for the recent rise can be attributed to the growing Metaverse, GameFi, and NFT narratives, which are all largely built on the ETH network.\u201d<\/p><\/blockquote>\n Although ETH is still far from being fully decoupled, the spokesperson highlighted that such a vision can no longer be considered just a pipedream, as the overall narrative is already beginning to shift thanks to Ethereum\u2019s new emerging use cases and adoption. <\/p>\n Not only that, the analyst also opined that a similar scenario could very well play out for a number of other prominent altcoins as well: \u201cJust like in traditional equities, there will be no distinction between \u2018BTC and alts,\u2019 but rather with prices of all tokens being independently driven by both systematic and unsystematic risks.\u201d<\/p>\n Igneus Terrenus, head of communications for cryptocurrency exchange Bybit, told Cointelegraph that, at the end of the day, the value of a digital asset is determined by its supporters and investors, and with more than six years of development and a plethora of smart contract applications built atop Ethereum \u2014 including those related to fledgling spaces like DeFi and NFTs \u2014 the premium altcoin has now developed an identity and ecosystem of communities that exist independently from that of BTC, particularly over the past year. \u201cOverlaps will still remain, but there is now sufficient difference to sustain a divergence in price movement,\u201d Terrenus said, adding:<\/p>\n \u201cAs the demographics of BTC and ETH camps continue to diverge, we shall also expect to see their respective price actions gradually disentangling even further.\u201d<\/p><\/blockquote>\n Netta Korin, co-founder of Orbs, a public blockchain infrastructure, highlighted to Cointelegraph that ETH\u2019s straight-up northbound movement since Oct. 1 continues to add fuel to the narrative that Ether truly could flip Bitcoin sometime in the near future. Even though a vast majority of other cryptocurrencies continue to exhibit a high degree of correlation with BTC, she said that Ether has clearly proven to be \u201coil for DApps.\u201d <\/p>\n Korin added that Ethereum has long passed Bitcoin as the most used blockchain and, even when it comes to recovery after periods of market cooldowns, it has demonstrated significantly better performance than BTC. She further stated that the upcoming Eth2 upgrade will \u201cenhance the demand perspective,\u201d adding: <\/p>\n \u201cNew supply and demand mechanics of Ethereum and its position as the leading financial infrastructure and a crucial backbone for some of the most popular projects, like MakerDAO and Uniswap make ETH decoupling a potential reality.\u201d<\/p><\/blockquote>\n Korin also pointed out that Ethereum is a key player in DeFi and a central platform for the NFT space, which seeks to build financial applications for lending and trading on the blockchain \u2014 of which more than 3,600 DApps are currently running atop the Ethereum ecosystem. Not only that, Ether could also be an inflation hedge due to its links to DeFi and the market for NFTs, two areas that will grow exponentially in 2021, in her view. \u201cEther is on pace to overtake Bitcoin as the top cryptocurrency by market capitalization,\u201d she concluded.<\/p>\n If ETH\u2019s decoupling is an imminent reality, will this impact a potential BTC bullish move if the ETH\/BTC pair starts to grow? On the subject, a member of Binance\u2019s research wing pointed out to Cointelegraph that, if the price spread between the ETH\/BTC pair continues to grow at its current trajectory, it would still not be correct to say that the development could lead to an overall growth spurt for BTC, noting:<\/p>\n \u201cLarge investors will continue to buy BTC regardless of how bearish it looks on the charts or how other tokens are performing. They do so because BTC remains […] the pioneer in the space and market driver. This is further fuelled by the narrative of BTC being a digital store of value and hedge against inflation.\u201d <\/p><\/blockquote>\n That being said, the Binance analyst did concede that, when considering the other end of the spectrum, they still expect to see a feeding frenzy amongst both retail and institutional investors as they rush in to increase their exposure in ETH.<\/p>\n Ether\u2019s increasing market clout has not gone unnoticed by major financial institutions around the globe, with U.S. banking giant JPMorgan Chase claiming<\/a> in a recent report that ETH could be a better bet for investors than BTC, especially as the digital asset market continues to mature and evolve. According to the company\u2019s research analysts, ETH\u2019s fivefold rise in comparison to BTC over the last year has resulted in the altcoin accruing a market cap that is nearly half of that of Bitcoin\u2019s.<\/p>\n Another aspect of ETH that has many investors starry-eyed is the network\u2019s potential to gain a major foothold in the burgeoning Web 3.0 ecosystem, which is extremely popular at the moment even though its real-world implementation is still years away. While nobody can for sure ascertain how this space will continue to evolve, there is a good chance that ETH will capture much of the value associated with the decentralized Web 3.0 in the future.<\/p>\n Related: <\/em><\/strong>Status check: Ethereum in full deflation mode as Eth2 merge gets closer<\/em><\/strong><\/a><\/p>\n Last but not least, it is worth noting that the Ethereum network\u2019s recently implemented London upgrade \u2014 which went live during August 2021 \u2014 altered the way in which the currency\u2019s gas fee rates are calculated, effectively burning a portion of all ETH-based fees and reducing the altcoin\u2019s total supply pool. Numbers-wise, this has resulted in Ether\u2019s annual inflation rate<\/a> dipping from ~4% to ~3%.<\/p>\n Not only that, Ether\u2019s ever-evolving monetary policies are also designed to help convert the asset into a deflationary one, making it attractive to long-term owners as well as institutional funds. Therefore, it stands to reason that Ether\u2019s perception as an independent asset will only continue to garner more support.<\/p>\n<\/div>\n![](\"https:\/\/s3.cointelegraph.com\/uploads\/2021-12\/09b85261-1f1f-4fe8-8a5e-4fe31a024847.png\")
<\/figure>\nThe \u2018flippening\u2019 narrative\u00a0<\/h2>\n
ETH is uniquely positioned in the market<\/h3>\n
Could ETH\u2019s continued independence help spur BTC?<\/h3>\n