Cryptocurrency analyst Benjamin Cowen has pointed out how the current market cycle sentiment is majorly impacted by Ethereum’s ETH/USD flat price performance.

What Happened: In a podcast on Friday, Cowen highlighted why many investors are frustrated despite Bitcoin‘s BTC/USD rally to $84,000.

His main observation was that Ethereum is at the same price level as two years ago, a stark contrast to Bitcoin’s 265% rise in the same period.

Cowen attributed Ethereum’s underperformance to monetary policy shifts, particularly the Federal Reserve’s quantitative tightening.

Many investors expected altcoins to outperform Bitcoin in a bull market, but that hasn’t happened. Fading Bitcoin dominance has hurt altcoin-heavy investors, making this cycle feel worse.

Also Read: Standard Chartered Lowers Ethereum Price Target To $4,000: Here’s Why A Coinbase Blockchain Is To Blame

Why It Matters: Cowen pointed to the Advance-Decline Index of the top 100 cryptocurrencies, which just hit a new low, signaling continued weakness across altcoins.

This contrasts sharply with 2020-2021, when “everything was going up”, making this cycle feel like the complete opposite for altcoin investors.

Cowen acknowledged the Fed’s recent move to slow quantitative tightening, cutting Treasury redemptions from $25 billion to $5 billion.

He cautioned that QT isn’t over yet, as the Fed still maintains a $35 billion monthly cap on mortgage-backed securities reduction.

What’s Next: Looking ahead, Ethereum’s breakdown could actually be a catalyst for a policy shift.

According to Cowen, “The Fed will respond to markets… the markets tell the Fed what to do, not the other way around.” He noted that past Ethereum bottoms have aligned with shifts in Fed policy, suggesting history could repeat.

Ethereum’s logarithmic regression band bottom could act as support, potentially coinciding with a monetary policy pivot from the Fed.

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