Ethereum's 65% BTC Slide Since the Merge Explained

Ethereum$1,840.25 did the hard fork, cut the energy bill by 99.95%, and still got smoked by Bitcoin$64,051.80. That is the basic chart crime here.

Since the Merge in September 2022, ETH has fallen about 65% against BTC, with the ETH/BTC ratio sliding from roughly 0.085 to around 0.028 by late May 2026, according to the source report and public market data it cited. ^[1] The debate now is not whether ETH underperformed. It obviously did. The fight is over why.

One insider critique making the rounds says this was not just macro, ETF flows, or Bitcoin doing Bitcoin things. The claim is sharper: Ethereum built up execution debt, then paid for it in relative price.

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The case against Ethereum's post-Merge strategy

The core argument comes from Reid, described in the source as an ICO-era Ethereum participant who still builds on the network and remains long ETH. His view is blunt. Ether's weak performance versus Bitcoin reflects specific product and strategy failures, not some vague coordination problem. ^[2]

That matters because it shifts the conversation away from market structure and toward management. In this framing, Ethereum did not simply lose attention. It missed obvious commercial asks.

Reid's complaint starts with messaging. The Merge was sold heavily on energy efficiency and ESG friendliness. That was real, and technically impressive. But his point is that capital allocators were not waiting around for greener blockspace. They wanted yield, clearer investment cases, and a simpler path into staking. Users wanted lower fees. Developers wanted reliability and speed. Solana$74.69, meanwhile, spent that period pushing a much simpler pitch: fast chain, live apps, go trade.

That is not a moral argument. It is a product one.

A technically huge win that did not translate into market demand

The Merge was one of crypto's biggest engineering feats. Ethereum moved from proof-of-work to proof-of-stake without blowing itself up, which, to be fair, is more than can be said for a lot of chains that promise less and break more.

But markets do not pay for effort. They pay for outcomes.

ETH bulls expected the Merge to tighten supply, improve staking economics, and strengthen ether's long-term monetary story. Some of that happened on paper. What did not happen was a clean conversion of that story into stronger relative demand than Bitcoin.

Bitcoin had a simpler setup. Spot ETF momentum, institutional familiarity, and the "digital gold" meme kept doing numbers. Ethereum's pitch got noisier. Was ETH a yield asset, a tech platform, ultrasound money, internet bond, gas token, or settlement layer for rollups? Depending on the week, it was all of the above. That is powerful if you are deep in the weeds. It is messy if you allocate size. ^[3]

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The staking UX problem

One of the more practical criticisms is that Ethereum$1,840.25 never made native staking feel obvious enough for normal holders.

For years, solo staking carried hardware, technical, and minimum-capital barriers. Pooled staking filled the gap, but that came with centralization tradeoffs. Instead of a clean, first-party staking experience becoming a flagship post-Merge product, users largely got a patchwork of liquid staking providers, custodians, and interfaces that sat one layer removed from Ethereum itself.

That gap matters because staking was supposed to be one of proof-of-stake Ethereum's clearest value props. If the chain secures itself through staked ETH, then making that process easy should have been table stakes, not a side quest.

The criticism here is simple: Ethereum shipped the engine, but not the showroom.

Lido dominance and the centralization tradeoff

That missing UX opened the door for Lido DAO$0.3585 and other liquid staking protocols to capture outsized share. Reid reportedly points to Lido dominance as part of the problem, and it is not hard to see why. ^[4]

Liquid staking solved a real need. Users wanted yield and liquidity at the same time. Lido gave them that. But as one provider becomes too important, the network inherits a new political and technical risk surface. Ethereum avoided proof-of-work miner concentration only to spend the next cycle worrying about validator concentration and governance influence through staking pools.

From a value-capture angle, this also muddies the ETH story. If the most attractive staking experience and liquidity layer live in third-party wrappers, some of the economic upside gets intermediated away from the base asset. ETH still sits underneath it, but the user relationship and product moat shift elsewhere.

That is not fatal. It is just not ideal if your investment thesis depends on ETH being the obvious center of gravity.

The rollup question: scale for users, leakage for ETH?

The second big complaint is Ethereum's rollup-centric roadmap. Again, this is not a new argument, but the weak ETH/BTC chart gives critics more ammo.

Ethereum chose to scale by pushing activity to layer 2 networks. That improved transaction costs for users and made the ecosystem more extensible. It also created a recurring tension: if the best user experience happens off mainnet, how much value accrues back to ETH at layer 1?

The bull case says all roads still settle on Ethereum. The bear case says users do not care where they settle, only where fees are cheap and apps work. If rollups capture the mindshare, tokens, sequencer economics, and app relationships, then mainnet risks becoming a security budget backend with weaker direct monetization than bulls expected.

That is the value-drain argument in plain English. Ethereum may be winning architecturally while leaking attention and economics at the surface layer.

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Bitcoin comparison makes the pain look worse

Some of ETH's underperformance is about Bitcoin$64,051.80 being unusually strong, not just Ethereum being weak. That distinction matters.

Bitcoin's post-2022 narrative became cleaner, not messier. Institutions understood it. ETF wrappers made access easier. Macro traders liked it. Regulators, relative to the rest of crypto, treated it as the least confusing asset in the room. ^[5]

Ethereum moved the opposite way. It became more complex while trying to scale, support rollups, defend decentralization, and preserve monetary credibility. Complexity is not always bad, but it usually carries a valuation discount when compared to an asset with a simpler institutional pitch.

So yes, the 65% slide versus BTC is partly an Ethereum story. It is also a Bitcoin simplicity premium story.

This is also a fight over leadership priorities

The source article notes criticism of the Ethereum Foundation for prioritizing philosophy and ESG-adjacent messaging over commercial execution. That is the spicy part, because it is really a critique of leadership style.

Ethereum has long prided itself on being research-heavy, values-driven, and careful. That culture helped it survive hard technical problems. It may also have slowed its ability to package products around what markets were actually asking for at specific moments.

Reid's point, as presented in the source, is not that Ethereum lacked talent. It is that the ecosystem's most visible institutions failed to turn that talent into tighter product-market fit. Seven years to deliver proof-of-stake is an achievement. It is also a very long time in a market where rivals can launch, iterate, and steal mindshare before your roadmap ships.

That kind of criticism will sound unfair to Ethereum diehards. It will sound obvious to traders staring at the ratio chart.

The Bottom Line

ETH getting chopped 65% versus BTC since the Merge is not one clean story. It is a stack of them: Bitcoin's easier institutional narrative, Ethereum's muddier value capture, weak staking UX, third-party dominance in liquid staking, and the unresolved question of whether rollups enrich ETH or route around it.

The insider critique matters because it avoids the usual cope. No "the market just doesn't get it." No grand theory of temporary mispricing. Just a harsher claim: execution choices have consequences.

If Ethereum can tighten staking access, show that layer 2 growth actually drives durable ETH demand, and simplify its pitch, the ratio can stabilize. If it keeps outsourcing the best user experiences while asking investors to love the base layer on principle, expect the BTC pair to stay ugly.

Ethereum's 65% BTC Slide Since the Merge