Two Prime Shifts to Bitcoin-Only as Ethereum Drops 45% in 2025
Two Prime, an investment advisory firm based in the United States, has caused a stir by removing Ethereum (ETH) from its trading and lending strategy due to issues with unpredictability and declining value metrics. The company now takes a Bitcoin-only stance, describing Ether’s recent trading patterns as “more like a memecoin” than a stable digital asset.
The announcement comes on the heels of Ethereum’s price declining 45% year-to-date in 2025, a stark departure from Bitcoin’s relative stability over the same period.
‘ETH Is No Longer Worth Engaging’
Two Prime, a registered investment adviser with the U.S. Securities and Exchange Commission (SEC), publicly disclosed the change of strategy on May 1. The company had extended over $1.5 billion worth of loans employing both Bitcoin and Ethereum over the past 15 months.
In the firm’s announcement, ETH was severely criticized:
“ETH’s statistical trading behavior, value proposition, and community culture have been short of expectations beyond a point that is worth discussing.”
According to Two Prime, ETH no longer forms a part of algorithmic trading models due to its volatile behavior, inability to maintain consistent correlation with Bitcoin, and an unstable performance profile.
“It Now Trades Like a Memecoin”
The firm maintained that Ether deviated widely from Bitcoin both in terms of price action and predictability.
“It is now trading more like a memecoin than a predictable asset,” Two Prime stated, pointing to a number of multi-standard deviation swings in Q1 2025.
This volatile nature, the firm noted, makes algorithmic trading and lending backed by ETH more challenging—even in a market already marked by volatility. As a result, ETH no longer meets the firm’s risk-reward criteria, leading Two Prime to focus solely on Bitcoin.
Ethereum Community Reacts: Is This the Bottom?
The crypto community was quick to react, with some viewing Two Prime’s withdrawal from ETH as a contrarian signal of a potential price reversal.
If this isn’t a bottom signal for ETH idk what is,” one user tweeted on X (formerly Twitter).
Some weren’t so sure, questioning the bearishness of Two Prime’s action.
“Never even heard of them. Looks irrelevant,” another commenter replied, opining that the market could be overestimating the reaction to the company’s strategy.
This dichotomy is a function of the uncertainty surrounding Ethereum’s short-term future, especially with ongoing talk about its underlying value and institutional adoption in the future.
Ethereum ETFs: Demand Trails Behind Bitcoin
The second most significant factor to support Two Prime’s conclusion is the underperformance of Ethereum ETFs. The company observed that Bitcoin ETFs have significantly outperformed ETH products in institutional flows of investment.
“The collapse of ETH’s ETF creates a reflexive cycle in motion whereby institutions such as BlackRock commit less resources to their promotion and sales,” Two Prime stated. “BTC has found the mainstream while ETH has languished.”.
Despite this level of criticism, Ethereum remains the largest altcoin in AUM in exchange-traded products. ETH-based ETPs had $9.2 billion in AUM toward the end of April 2025, higher than Solana’s $1.4 billion and that of XRP at $1 billion, according to CoinShares.
ETF Setbacks and Institutional Pullback
The general tone surrounding Ether ETFs has lost strength in the last year. Following SEC approval in May 2024, Ether spot ETFs did not achieve the traction that came with the introduction of Bitcoin ETFs.
A number of issuers have retreated: VanEck shelved its ETH futures ETF, WisdomTree withdrew its Ethereum Trust ETF filing, and ARK Investment Management closed both its Ether and Bitcoin futures ETFs in March 2025 because of underperformance.
Conclusion
Two Prime’s Ethereum exit signals increasing concern over the asset’s trading pattern, investor attitude, and institutional support. The move is called premature by critics, while others see it as part of a larger trend of capital concentration in Bitcoin. Whether ETH is approaching bottoming—or subject to further erosion—is up for debate.
