Bitcoin (BTC) and Ethereum (ETH) are two giants in the cryptocurrency space, but they serve very different purposes. Bitcoin, the first-ever cryptocurrency, is often referred to as "digital gold," acting as a store of value and a hedge against inflation.

Its blockchain is designed for simplicity, prioritizing security and decentralization. Ethereum, on the other hand, is a platform for building decentralized applications (dApps), enabling smart contracts that automate agreements without intermediaries. While Bitcoin is seen as a safe haven for long-term investors, Ethereum drives innovation in blockchain technology. Both are crucial in the crypto ecosystem but cater to distinct use cases.

The smartest approach to managing your Bitcoin and Ethereum holdings isn't guessing market tops or bottoms—it’s rebalancing. Rebalancing involves setting a desired ratio between BTC and ETH, such as 70/30 or 50/50, based on your investment goals.

When one of the assets grows faster and the balance shifts, the strategy automatically adjusts—selling the overperforming asset and buying the underperforming one. Instead of trying to time the market, building a portfolio with a rebalanced DCA (Dollar-Cost Averaging) strategy combines the power of consistent investing with the discipline of maintaining a balanced allocation.

One of the simplest and most neutral approaches to allocating between Bitcoin and Ethereum is to weigh them based on their market caps. For example, if Bitcoin represents 60% of the combined market cap of BTC and ETH, you would allocate 60% of your investment to Bitcoin and 40% to Ethereum.

This method avoids making big bets on either asset, letting you follow the broader market consensus. By staying neutral and aligning with market caps, you reduce the risk of being overexposed to one asset while still benefiting from the growth potential of both. It’s a balanced strategy that appeals to long-term investors seeking steady growth.

Ethereum has been closing the gap on Bitcoin in terms of market value and adoption, especially with the rise of decentralized finance (DeFi) and NFTs, which rely heavily on its blockchain. Ethereum's shift to proof-of-stake (The Merge) has improved its scalability and energy efficiency, making it more appealing to both investors and developers.

However, Bitcoin remains the king of crypto due to its unmatched security, global recognition, and fixed supply. While Ethereum has the potential to "boom" due to its utility, overtaking Bitcoin entirely would require massive adoption and trust, which Bitcoin has already cemented over more than a decade.

With rebalanced DCA approach you don't have to pick the winner.

BTC/ETH

Bitcoin vs Ethereum

When to swap between Bitcoin and Ethereum?

How much should you invest in Bitcoin and how much in Ethereum?

Is ETH going to boom? Will it ever catch Bitcoin?

Team

Jan Klosowski

Guillem Avila