This Cryptocurrency Has Quietly Outperformed Bitcoin Over the Last Year

Bitcoin (CRYPTO: BTC) is far from the only asset worth watching in crypto, but it tends to get the most attention, by far. Nonetheless, over the last 12 months, Ethereum (CRYPTO: ETH) has gained 48%, while Bitcoin has fallen about 11%. That huge gap unfolded almost entirely outside the spotlight because Ethereum's price has been trending down since the disastrous flash crash on Oct. 10, 2025.

Better times are likely ahead for the coin. Here's why Ethereum's continued outperformance relative to Bitcoin is very likely over the next year or so.

Image source: Getty Images.

These upgrades aren't priced in yet

Unlike Bitcoin, Ethereum's blockchain frequently gets significant incremental upgrades, and at least as of last year, the pace has been set at two such upgrades per year.

In 2025, the Pectra update was launched in May and expanded the data throughput capacity for Ethereum's layer 2 (L2) networks -- blockchains that bundle transactions independently and then settle them on the main Ethereum network. It also introduced account abstraction, a critical feature that enables regular wallets to temporarily function like programmable smart-contract wallets.

Then, with the launch of the Fusaka update in December, the chain now has a data-availability sampling system called PeerDAS. Both Fusaka and Pectra, along with prior improvements to the network's scaling capabilities, helped to deliver gas fees that are presently 83% lower than just 12 months ago and down 98% from three years ago.

In other words, the chain is materially more capable than a year ago, and the build-out is ongoing.

This year will see the launch of Glamsterdam, which is targeted for the first half of this year, and Hegota, which is scoped for the second half. Both of those upgrade packages will build on the recent scaling improvements while laying the technical groundwork for even greater scaling improvements in the future, via parallel processing of transactions, for instance.

What might put this coin back in the spotlight

Ethereum's increasingly sophisticated blockchain won't catch much attention if there isn't real capital allocated to its ecosystem.

On that front, the picture looks to be favorable and improving. Twelve months ago, its decentralized finance (DeFi) protocols had $45 billion in total value locked (TVL) -- the largest in the crypto sector by far -- whereas on April 14 of this year, TVL was $56 billion.

More TVL means that there's more capital parked on Ethereum to generate a yield, which in turn means there's more capital available to fund the development of new decentralized applications (dApps) and other types of on-chain businesses producing value. As the chain's throughput continues to improve, driving down gas prices and increasing the set of technical capabilities it can offer to developers looking to make apps, it'll continue to become an even cheaper and easier place to launch new projects and manage on-chain capital.

Still, Ethereum's fundamentals are meaningfully stronger than they were 12 months ago, and its price hasn't caught up. That kind of gap won't last forever, and when it starts to close, the coin is likely to outperform Bitcoin by an even larger margin than it is now.

Alex Carchidi has positions in Bitcoin and Ethereum. The Motley Fool has positions in and recommends Bitcoin and Ethereum. The Motley Fool has a disclosure policy.