Bitcoin (BTC) has outperformed Ethereum (ETH) in the past year, with BTC rising by 74% and ETH declining by 28%.
This performance gap between BTC and ETH has widened over time, with BTC dominance appearing stretched, while Ethereum is seen as undervalued and primed for a potential catch-up phase.
Observers believe a 'rotation season' is approaching, suggesting a possible capital rotation from Bitcoin to altcoins, particularly ETH.
Historically, wide performance gaps between BTC and ETH tend to normalize as investor interest in alternative Layer 1 assets increases, especially when market conditions favor risk rotation.