Tom Lee: ETH/BTC exchange rate may strengthen in the second half of 2026, Ethereum is about to undergo a new round of value reassessment?

Beijing Time, July 3, 2026, the crypto market saw a broad rebound. According to Gate market data, Bitcoin (BTC) bounced from a 24-hour low of $59,776 to $61,507; Ethereum (ETH) rebounded more sharply, surging from a low of $1,605 to $1,725, currently trading at $1,705.42, up 4.45% in a single day. BTC is now at $61,409.3, up 1.07% in 24 hours, with a market cap of approximately $1.23 trillion. ETH's market cap is about $12.3k, with a market share of 7.19%.

However, more noteworthy than the daily price swings is Ethereum's long-term value coordinate relative to Bitcoin—the ETH/BTC ratio. As of mid-2026, this ratio is near multi-year lows of around 0.026, down sharply from about 0.08 in 2021 and 0.15 in 2017. In other words, one ETH now buys roughly one-third the amount of BTC it could four years ago.

It is against this backdrop that BitMine Chairman Tom Lee stated clearly on July 3 that the ETH/BTC ratio has ample reason to strengthen in the second half of 2026 and expects the ratio to continue rising throughout the year.

Why ETH/BTC is a Core Indicator of Market Style Shifts

The ETH/BTC ratio essentially measures the market's relative pricing of two value propositions: "smart contract platform" versus "digital gold." Bitcoin's core narrative is "store of value"—fixed supply, decentralized, censorship-resistant. Ethereum's narrative is more complex: it is both a smart contract platform and a settlement layer, hosting real-world applications such as stablecoin issuance, DeFi lending, and RWA tokenization.

When market risk appetite rises and capital seeks growth assets, ETH tends to outperform BTC; when risk aversion intensifies and capital flows into "crypto safe-haven assets," BTC becomes relatively stronger. Therefore, the ETH/BTC ratio is one of the most direct windows into crypto market style shifts.

Tom Lee believes that ETH's narrative as "money" is gaining market attention—this positioning differs from Bitcoin's singular "digital gold" attribute, pointing to ETH's multiple functions as a settlement medium, collateral asset, and payment tool in real economic activities. If this narrative holds, the recovery of the ETH/BTC ratio will not be just a technical bounce but a structural revaluation.

Three Major Catalysts: Stablecoins, RWA, and Ecosystem Upgrades

Continuous Expansion of the Stablecoin Ecosystem

Stablecoins are one of the core use cases on Ethereum. As of May 2026, the total global stablecoin market cap has exceeded $320 billion, with USDT holding about 58.9% market share and a circulation close to $190 billion. In February 2026, the global stablecoin on-chain transaction volume rose to approximately $1.8 trillion.

Ethereum hosts about $156.7 billion in stablecoin value, accounting for 49.5% of the total $315.1 billion stablecoin supply. Stablecoin use cases have rapidly expanded from exchange-based settlement tools to a globally circulating payment medium. In 2025, stablecoin annual transaction volume reached approximately $33 trillion, surpassing the combined transaction processing total of Visa and Mastercard at $25.5 trillion.

On July 1, 2026, Open Standard—an independent entity jointly formed by over 140 financial and tech companies, including Stripe, Visa, BlackRock, and Coinbase—announced the launch of the dollar stablecoin Open USD (OUSD). This event marks stablecoins' transition from crypto-native tools to mainstream financial infrastructure. Every dollar of stablecoin issued requires corresponding on-chain settlement and clearing, and Ethereum, as the largest stablecoin hosting network, will continue to benefit from this expansion.

Accelerating RWA Tokenization

Real World Asset (RWA) tokenization is one of the fastest-growing sectors in the crypto industry in 2026. As of June 2026, the total market cap of on-chain tokenized RWAs reached $31.8 billion (peak), up approximately 589% from an active market cap of just $4.3 billion at the start of 2025. This growth rate far exceeds that of DeFi and stablecoins during the same period.

Ethereum currently hosts about 53% of the crypto industry's tokenized RWA value. By asset class, public debt (sovereign bonds and money market funds) remains the largest underlying asset, with a market cap of about $17 billion, accounting for nearly 60% of the overall market. Tokenized public equities achieved over 170% year-to-date growth, covering approximately 500 products. Private credit reached $4.23 billion, becoming one of the most active RWA collateral categories with a 52% DeFi utilization rate.

The core logic of RWA tokenization is: once traditional financial assets (treasuries, stocks, credit) are brought onto the blockchain, they require on-chain issuance, trading, settlement, and other operations. Ethereum, as the most mature smart contract platform, naturally becomes the preferred hosting layer for these assets. Every $1 of RWA on-chain means increased demand for the Ethereum network—whether in gas fees, settlement efficiency, or contract interactions.

Continuous Innovation in the Ethereum Ecosystem

In May 2026, the Ethereum mainnet activated the Pectra upgrade—the hard fork with the highest number of EIPs (Ethereum Improvement Proposals) in Ethereum's history. Pectra introduced EIP-7702, allowing externally owned accounts (EOAs) to temporarily execute smart contract code, unlocking features such as transaction batching, gas sponsorship, and social recovery. Additionally, Pectra doubled blob throughput, raised the maximum effective balance for validators from 32 ETH to 2,048 ETH, and significantly shortened validator onboarding time.

More importantly, Ethereum's Glamsterdam roadmap aims to increase the gas limit from about 60 million to roughly 200 million, effectively tripling Layer 1 capacity and reducing gas fees for complex DeFi transactions by 60-70%. This means the Ethereum mainnet's processing power will significantly increase, enabling it to handle higher-frequency stablecoin transactions and RWA settlements.

On-chain data already confirms ecosystem activity: in the 2025-2026 market cycle, Ethereum's daily active addresses consistently exceeded 1 million, peaking above 1.3 million, setting new all-time highs. The decoupling between network activity and price trends precisely indicates that fundamentals are accumulating rather than declining.

What Factors Could Affect ETH's Relative Performance Against BTC?

ETH's relative performance against BTC is not unidirectional upward; the following factors pose significant constraints.

The macro interest rate environment is the primary variable. In early July 2026, the Federal Reserve held the benchmark rate steady at 3.50%-3.75%, with expectations for rate cuts cooling significantly this year. In a high real-rate environment, capital tends to favor low-risk assets, suppressing the valuation of high-beta assets like ETH. However, the U.S. June nonfarm payrolls data released on July 3 showed only 57k new jobs, roughly half of economists' expectations. This "bad news" actually boosted market expectations of liquidity easing, driving both BTC and ETH higher.

ETF fund flows show divergence. On July 1, U.S. spot Ethereum ETFs recorded net inflows of $14.89 million, ending nine consecutive days of net outflows, with BlackRock's ETHA seeing a single-day inflow of $36.63 million. Meanwhile, Bitcoin ETFs saw net outflows of $296 million on the same day. On July 2, Ethereum ETFs recorded net inflows of 21,568 ETH, while Bitcoin ETFs saw net outflows of 6,165 BTC. If this divergence persists, it will provide direct support for the ETH/BTC ratio.

Supply dynamics are also noteworthy. Ethereum's supply is expanding at an annualized rate of nearly 0.2%, but increased network activity could shift it toward deflation. The total staked in ETH 2.0 has exceeded 25.43 million ETH, worth approximately $48.98 billion at current market prices. The continued expansion of staking reduces circulating supply in the secondary market, providing structural price support.

In terms of institutional expectations, Citigroup recently lowered its 12-month Bitcoin target from $112,000 to $82,000 and cut its Ethereum forecast from above $3,000 to $2,240. Standard Chartered expects Bitcoin could fall to $50,000 and Ethereum to $1,400 in the short term. These downward revisions reflect the current macro headwinds but also indicate that pessimistic expectations have been largely priced in.

What On-Chain and Market Indicators Should Investors Monitor?

To track the ETH/BTC ratio trend, the following indicators offer high reference value.

The ETH/BTC ratio itself is the most direct observation window. Currently, the ratio is near historical lows around 0.026. Technical analysis suggests ETH/BTC is in a large accumulation zone on higher timeframes. A break above 0.030 could signal a trend reversal.

ETF fund flows serve as a barometer of institutional demand. Continuous tracking of daily net inflows/outflows for U.S. spot Ethereum ETFs is necessary, especially for top products like BlackRock's ETHA.

Stablecoin and RWA total value locked is a core indicator of Ethereum's actual usage demand. Whether stablecoin market cap breaks above $320 billion and RWA tokenization expands from $31.8 billion will directly determine the demand base for ETH as a "settlement asset."

Network activity includes daily active addresses, transaction volume, and gas fee levels. Currently, daily active addresses remain above 1 million. If activity continues to rise while gas fees stay low (benefiting from scaling upgrades), it indicates the network is efficiently supporting more real-world applications.

Staking scale reflects long-term holder confidence. Total ETH 2.0 staked has exceeded 25.43 million ETH. Continued growth in staking means a tightening of circulating supply.

Conclusion

The ETH/BTC ratio falling to historical lows near 0.026 reflects Ethereum's significant underperformance relative to Bitcoin over the past year, but also implies accumulating potential for a reversal. The stablecoin ecosystem surpassing $320 billion, RWA tokenization reaching $31.8 billion, and the Pectra upgrade going live—these three structural changes are reshaping Ethereum's fundamentals.

Tom Lee's judgment is not an isolated case: Ethereum's on-chain lending and RWA tokenization activity saw strong growth in the first half of 2026, decoupling from its price decline of 63% from all-time highs. This divergence of "price down, on-chain up" is often a precursor to value revaluation.

Of course, the macro interest rate environment, ETF fund flows, and supply dynamics still pose significant uncertainty. The recovery of the ETH/BTC ratio will not be linear, but monitoring the above on-chain and market indicators will help investors navigate style shifts in a volatile market.

FAQ

Q1: What level is the ETH/BTC ratio currently at?

As of July 3, 2026, the ETH/BTC ratio is approximately 0.0277 (1,705.42 / 61,409.3), near multi-year lows. This ratio is sharply down from about 0.08 in 2021 and 0.15 in 2017.

Q2: Why does Tom Lee favor the ETH/BTC ratio?

BitMine Chairman Tom Lee stated on July 3 that the ETH/BTC ratio has ample reason to strengthen in the second half of 2026. The core logic is that ETH's narrative as money is gaining market attention, with three catalysts—stablecoin growth, RWA tokenization, and ecosystem innovation—all reinforcing ETH's store-of-value properties.

Q3: How do stablecoins and RWA affect ETH's price?

The expansion of stablecoins and RWAs means more real economic activity is settled on the Ethereum chain. Each stablecoin transfer and RWA transaction consumes gas fees, increasing demand for ETH. As of June 2026, the on-chain RWA total market cap was $31.8 billion; stablecoin total market cap exceeded $320 billion.

Q4: What does the Pectra upgrade mean for Ethereum?

Pectra is an Ethereum upgrade activated in May 2026, containing the highest number of EIPs in Ethereum's history. Key changes include introducing EIP-7702 for account abstraction, raising the maximum validator staking limit from 32 ETH to 2,048 ETH, and doubling blob throughput.

Q5: How should investors monitor the ETH/BTC ratio trend?

It is recommended to focus on four dimensions: the technical position of the ETH/BTC ratio itself, daily fund flows for U.S. spot Ethereum ETFs, the total value locked in stablecoins and RWAs on Ethereum, and network activity indicators such as daily active addresses.